Oral
Answers to
Questions

JUSTICE

The Secretary of State was asked—

Court Closures

Mohammad Yasin: What assessment his Department has made of the effect of court closures on access to justice.

Lucy Frazer: We are looking at ways to improve our justice system and to modernise the delivery of justice in many ways, including with technology. In circumstances where 41% of tribunals were used at half their capacity in 2016-17, it is right that we consider whether spending money on the physical estate is the best use of money.

Mohammad Yasin: The Government like to say that they have reallocated court services rather than closed them, but Bedford has lost its magistrates court and employment tribunal court, so the public and lay members must travel more than 30 miles to access justice. Can the Minister reassure me that family court services, which are heard in the highly utilised ‎Shire Hall, will remain in Bedford indefinitely?

Lucy Frazer: The hon. Gentleman is right in relation to the changes taking place in Bedford to a certain extent, but I emphasise that the closure of the tribunal court is nothing to do with any changes being made by the Ministry of Justice or Her Majesty’s Courts and Tribunals Service. The tribunal service is closing because the landlord did not extend the lease, and it was a decision of listing, which is a judicial capacity, to move the tribunal court’s hearings elsewhere. Civil cases will be heard in Bedford magistrates court, and until another location is found, it will not close.

Kevin Hollinrake: Northallerton magistrates court in my constituency is scheduled for closure. Will the Minister consider using that court as a pilot for some of the future technology solutions, to ensure that those are workable in practice, before the closure is implemented?

Lucy Frazer: My hon. Friend makes a valid point, as has his neighbour, my hon. Friend the Member for Richmond (Yorks) (Rishi Sunak). I have met them both and the police and crime commissioner for the area. It is important to consider the appropriateness of pilots for mobile technology, and we will do so.

Richard Burgon: Thousands of key court staff were axed, but the Government are now spending tens of millions of pounds more on contracting agency staff. More than 100 courts were sold off, each raising not much more than the average house price. Now the Secretary of State has appointed someone with a slash-and-burn record as the new chair of the HMCTS board, telling the press that Tim Parker’s
“expertise will be vital as we deliver our reform and modernisation of the courts”.
To allay concerns that Mr Parker has been appointed for his toughness on cuts, can the Minister outline the specific expertise that Mr Parker has in working in our court system?

Lucy Frazer: The hon. Gentleman makes a number of points that I would like to refute, but I will mainly concentrate on two. It is important that where successful people in business put themselves forward for public service, we should welcome them and not put off experienced people from taking up important posts. Mr Parker has been successful in the businesses that he operated and has operated them appropriately, and we welcome him to his post. The hon. Gentleman also talks about cuts to our system. I would like to make it clear that the Ministry of Justice is proposing an extensive reform programme, which will put £1 billion into our courts service.

Philip Hollobone: Benefit applicants in Kettering tell me that they are now having to wait a completely unacceptable 45 weeks for tribunal appeal hearings due to a lack of a suitable location. Will the Minister look into that as a matter of urgency and get that problem fixed?

Lucy Frazer: It is very important that when cases are started, they are heard expediently, so that people are not prejudiced and do not have to wait for justice. I am happy to meet my hon. Friend to talk about those issues.

Community Sentences

Carol Monaghan: What recent assessment he has made of the effectiveness of community sentences on reducing reoffending rates.

Rory Stewart: This is something the Department studied in detail in 2015, and we have conclusive evidence that giving somebody a community sentence rather than  a short custodial sentence reduces reoffending over a one-year period.

Carol Monaghan: We have evidence of that in Scotland as well. The Scottish Government’s move towards community payback orders has helped Scotland to achieve its current 18-year low in reoffending. Is the Minister looking to the Scottish Government’s example and considering how they have managed to achieve these figures?

Rory Stewart: Absolutely. We have a lot to learn from Scotland, specifically on community sentences, and indeed we will be looking at what more we can do to emphasise  that a custodial sentence in the short term should be a final resort. In reoffending terms, it is often much better for somebody to be given a community sentence.

Derek Thomas: In Cornwall, I work closely with Konnect Cornwall, headed up by Ian Curnow, which does a lot of work on behalf of the Government and the Department for Work and Pensions to support ex-offenders and people who are on the way into trouble. What more resources can be made available so that no one is left behind?

Rory Stewart: A lot of this is about identifying those key local providers. The real challenge that we need to overcome, which is true not just for justice but for local councils, is that of making sure that when we work with the third sector we work, not with big national providers, but with small, grassroots local charities.

Kate Green: I draw the House’s attention to the fact that I am a life member of the Magistrates Association. In the all-party parliamentary group on women in the penal system, we recently heard from the Magistrates Association that magistrates are not familiar with the content of community penalties. That makes them reluctant to choose such penalties. The issue, in part, seems to be a lack of funding for training. Will the Minister comment?

Rory Stewart: This is a long-standing issue—it was true even in 2008-09—that consistently, the judiciary and magistrates have expressed concerns about community sentences. We need to do much more to build confidence, but the fact that this has been going on for nearly 10 years shows that it is a very challenging thing to do. Training will be an important part of that.

Prison Officer Recruitment

Craig Tracey: What progress his Department is making on recruiting 2,500 new prison officers.

Alan Mak: What progress his Department is making on recruiting 2,500 new prison officers.

David Gauke: Retaining and recruiting engaged and motivated staff is critical to delivering the solutions to drive improvement across the service. Between the end of October 2016 and the end of March 2018, we have increased prison officer numbers by 3,111 full-time equivalent staff. This is already significantly over our target of 2,500 additional staff by the end of December 2018. Investing in the frontline is vital for safety, rehabilitation and security, which is why we are spending £100 million a year in additional prison officers.[Official Report, 1 May 2018, Vol. 640, c. 1MC.]

Craig Tracey: I thank my right hon. Friend for that answer and commend him for the work that he has done on recruitment. Can he confirm when we can expect to see the new officers on the landings?

David Gauke: I can tell my hon. Friend that 90% of the 3,111 will be on the landings by the summer, and all will be in place and operational by the end of the year.

Alan Mak: I thank my right hon. Friend for his answer. Will he update the House on the progress being made towards the new key worker model and the impact it is having on prison officer recruitment?

David Gauke: My hon. Friend is absolutely right to raise that point. The key worker model is crucial. It will allow prison officers to spend more time, both on a one-to-one basis and with small groups of prisoners, improving staff-prisoner relationships. That can help us reduce both violence and reoffending. Some prisons, such as HMP Liverpool, are already running that scheme, and I look forward to more prisons fully implementing that over the months ahead.

Luke Pollard: Many of Dartmoor prison’s prison officers live in Plymouth and have told me of their concern that prison officer cuts, inexperienced new staff and increasing retirement ages are causing stress and concern. Can the Minister reassure me that there is a proper plan to address staffing and morale in our Prison Service?

David Gauke: There is already a proper plan to address that point about staffing. That is why the numbers are going up, and that is the point I am setting out. The numbers are at a five-year high. We are ahead of what we promised in October 2016. I am pleased that we are doing that and we will continue to recruit new prison officers—net new prison officers—into the Prison Service.

Jim Shannon: What additional training will these new officers be given to deal with the scourge of the availability of drugs in our prisons throughout the United Kingdom?

David Gauke: The hon. Gentleman makes an important point. We are refreshing the way that training works for prison officers. It is very important that we deal with the issue of drugs, which has been a real game-changer in its effect on prisons. As we change and refresh our training process, we need to ensure that new prison officers have the skills they need to deal with drugs.

Bob Neill: The net increase in the number of prison officers is very welcome, and I particularly welcome the Secretary of State’s reference to a key workers scheme, but does he agree that the mix of the workforce is important? Successful key worker and personal officer schemes will depend on having experienced staff, because they are best able to develop relationships with prisoners and deal with violence, the risk of suicide and other issues. Will a strategy now be put in place for the retention of existing staff, perhaps with incentives to encourage good people to remain in the service?

David Gauke: My hon. Friend is right; it is important that we not only recruit new staff, but retain existing staff. We are working closely with those prisons that are failing to retain staff. It is worth pointing out that in 2017 the percentage of prison officers in bands 3 to 5 who left the service was 9.7%—higher than we would like it, but not particularly out of line with other employers. Prison officers do a very valuable job, and we need to recognise that, support them and encourage those who have a lot to offer to continue to serve.

Imran Hussain: I am astonished that the Secretary of State can come here and appear somewhat triumphant. Let us be absolutely clear: this Government cut 7,000 prisoner officers, so there are still 4,000 fewer than there were in 2010. When does he expect prison staff numbers to return to 2010 levels?

David Gauke: I suspect that you, Mr Speaker, would stop me if we started a debate on the state of the public finances in 2010 and the difficult decisions that had to be taken as a result of the situation we inherited. The reality is that since October 2016 we have been recruiting more prison officers, we are ahead of what we said we would do and we are continuing to recruit prison officers. That is really important to ensure that prisons operate as they should.

Suicide in Prisons

Jim Cunningham: What recent assessment his Department has made of trends in the level of suicide in prisons; and what steps he is taking to reduce that level.

Rory Stewart: Any death from suicide in prison is a tragedy. We have managed to reduce the number of suicides in prison—it nearly halved between 2016 and 2017—and most of that progress is due to a new protocol that identifies the individual needs of prisoners and their times of maximum vulnerability.

Jim Cunningham: How many additional staff who are trained to deal with medical illness have been brought in?

Rory Stewart: Nearly 15,600 of our staff have received additional training—that is the figure produced by my colleague. The ACCT—assessment, care in custody and teamwork—process, which is the new protocol for suicide reduction, focuses on the evidence for when prisoners are most vulnerable, for example their first night in custody, and how to ensure that we deal with them. But we still need to reduce the number of suicides further.

Stuart McDonald: Ninety-three women have died in prisons in England and Wales since the 2007 Corston report. When the new female offender strategy is published, will it focus on community alternatives to prison, especially for the 70% of women who are sentenced to six months or less?

Rory Stewart: Absolutely. This is a common theme. We have clear evidence that reducing the use of custodial short sentences and instead diverting people into the community can be good for protecting the public, by reducing reoffending, but it is also very good for mental health and for reducing suicide.

Victims Law

Nick Smith: What his policy is on introducing a victims law.

Phillip Lee: Supporting victims of crime is a priority for the Government and we have made a commitment to publish a victims strategy by this summer. The strategy will set out our cross-Government approach to make  fundamental improvements for victims. It will also consider how compliance with the entitlements in the victims code might be improved and better monitored, and how criminal justice agencies responsible for the delivery of entitlements might be better held to account.

Nick Smith: The Minister has promised us a strategy by the summer, but a victims law was offered in the 2015 Conservative manifesto and included in the following Queen’s Speech and reiterated in the 2017 general election. When will this long-promised law finally see the light of day?

Phillip Lee: We are considering both legislative and non-legislative measures. If any legislation is required to underpin the victims code, we will bring it forward when parliamentary time allows.

Edward Davey: With respect to victims of domestic abuse, will the Minister consider women who are not eligible for legal aid to help with their divorce after domestic abuse, including women who currently fail the means test due to their having a share in a valuable family home? Will he meet me to discuss the problems that such women face in paying for basic legal advice?

Phillip Lee: I thank the right hon. Gentleman for the question. Yes, he has a point with regard to the funding of domestic abuse cases from legal aid. My ministerial colleagues are fully aware of this issue, and I am more than happy to meet him.

Gloria De Piero: Mr Speaker,
“Why should victims always have to be fighting their corner? That’s why we need a victims’ law.”
They are not my words, but the words of the Government’s Victims’ Commissioner. Can we be clear: will she and all the other people who are calling for it get a victims law?

Phillip Lee: My intention in the strategy is to outline the legislative requirements needed to underpin the victims code. By definition, that is a victims law.

Leaving the EU: UK Legal System

John Lamont: What steps the Government are taking to ensure that the UK legal system continues to operate effectively after the UK leaves the EU.

Lucy Frazer: First, I congratulate my hon. Friend on his impressive marathon run at the weekend.
We have agreed an implementation period that will give businesses and individuals legal certainty. We are now concentrating on ensuring that we negotiate the right future for our country, including a deal to ensure that there is mutual enforcement of recognition of judgments in the justice sector.

John Lamont: I thank the Minister for her response. I am very pleased not to have to bob this week, I can tell you, Mr Speaker.
Scotland is proud to have its own ancient and distinct legal system. Brexit will present the most significant challenge to that since the creation of the Scottish Parliament. It is therefore vital that we get it right. Will the Minister reassure me that, at her Department’s heart, it will ensure that Scots law continues to flourish post Brexit, respecting the distinct nature of Scots law and preventing legal confusion and chaos?

Lucy Frazer: My hon. Friend is right to identify that Scotland has a distinct legal system that should be respected. It is important that we engage fully with the devolved Administrations to ensure that we get the best and the right deal throughout the United Kingdom. The Secretary of State will be speaking this afternoon to the Scottish Justice Minister and my officials speak regularly with their counterparts in Scotland to ensure that we will get the best deal for the UK.

Laura Smith: Given the uncertainty surrounding Brexit, it is important that the Government do not add to the worries of businesses, especially those that would otherwise be in a position to invest and grow. Will the Secretary of State end the uncertainty in the credit market and release the response to part 2 of the soft tissue injury claims process consultation immediately?

Lucy Frazer: The hon. Lady raises an interesting issue that I am happy to look into. More generally, legal certainty is incredibly important, which is why it is so good that we have agreed the implementation period, which gives us a period of certainty.

Gregory Campbell: Has the Minister made any assessment in the Department of the beneficial changes that can follow from our legislative framework here in the UK, once we are finally unencumbered by the EU?

Lucy Frazer: The hon. Gentleman is right that, after we have left the EU, we will be able to determine our laws, which will benefit our country in the way that we decide.

Joanna Cherry: At the moment, there are two British judges on the European Court of Justice: one from the English legal tradition and one from the Scottish legal tradition. During the transition period, the domestic legal systems of the United Kingdom will continue to be subject to the full force of the jurisdiction of the European Court of Justice, whether in relation to litigation between private individuals or enforcement against the United Kingdom. Why, then, have the UK Government agreed to article 6 of the draft withdrawal agreement?

Lucy Frazer: The judges at the ECJ make a very valuable contribution to our jurisprudence and to the rights of individual citizens. It is worth pointing out that once someone is appointed as a judge of the ECJ, they are not a representative of their country; they are an individual determining cases that come before them, without any partisanship towards their country. Indeed, if we had a British case before the Court, there would be no saying whether it would come before an English judge or any other judge.

Joanna Cherry: One of the things that means the European Court of Justice is not a foreign court is the presence of British judges on it, but article 6 of the draft withdrawal agreement, which appears to have been agreed, provides that there will be no British judges on the Court of Justice during the transition period. Effectively, they are getting the sack at the end of next March, despite the Court’s continued jurisdiction over the United Kingdom. Does the Minister accept that, as a rule of law issue, it is concerning that there will be no Scottish judge and no English judge on the Court of Justice during the transition period, despite the fact that these countries will continue to be subject to the Court of Justice? Will she persuade the Prime Minister and the Secretary of State for Exiting the European Union to revisit this issue in the negotiations to come, so that there will be British judges on the Court of Justice during the transition period?

Lucy Frazer: As I mentioned, once the judges are appointed, they act independently of their country, so if we respect the judgments and the integrity of the other judges who are there already, we should be satisfied that we will get justice.

Service Animals

Stephen McPartland: What recent discussions he has had with Cabinet colleagues on the potential merits of creating a specific offence of attacking service animals.

Lucy Frazer: My hon. Friend, along with my right hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald) and the right hon. Member for Delyn (David Hanson), are campaigning strongly and tirelessly on this issue; I was very pleased to meet them on 17 April. I am not aware of any specific conversations that the Secretary of State has had with his Cabinet colleagues, but the Government are sympathetic to the intention behind the Bill, although we believe that the offence is already caught by other legislation.

Stephen McPartland: Police dog Finn from my constituency was stabbed in his stomach with a 10-inch blade. When the offender tried to stab his handler, police dog Finn jumped up and took another stab wound to his head to save the handler. If the handler had not been given a little scratch to his hand, the offender could not have been sent to prison, because the current legislation does not work. The Service Animals (Offences) Bill, which is promoted by my right hon. and learned Friend the Member for North East Hertfordshire (Sir Oliver Heald), has its Second Reading this Friday. I am grateful to the Minister for the meeting that she had with me, but will she support the Bill on Friday because it can make progress only with Government support?

Lucy Frazer: I am aware of the case and I was very pleased to discuss it. Police dog Finn did a remarkable thing, and I know that he has been recognised for his work. The Government are looking at the issue.

David Hanson: But will the Minister support the Bill on Friday?

Lucy Frazer: As the right hon. Gentleman knows, the Bill is in the hands of the Department for Environment, Food and Rural Affairs, and it will respond.

Oliver Heald: May I update my hon. and learned Friend? Some 34 out of the 41 police commissioners in this country support the Service Animals (Offences) Bill, and lawyers up and down the country, including Sarah Dixon, who runs the Finn’s law campaign, have identified a gap in the law. Is it not time that the Government backed my Bill?

Lucy Frazer: I am grateful for a third opportunity to address this issue and to speak again—this is the third time that I have heard my right hon. and learned Friend express his support for the Bill in the Chamber. As I have said, the Government are looking at this issue, and the matter is primarily for DEFRA.

John Bercow: In so far as the right hon. and learned Member for North East Hertfordshire (Sir Oliver Heald) seeks my advice, and he might not do so, my advice to him, to put it bluntly, is to follow Churchill’s adage: KBO—keep buggering on at all times. Just keep going, man!

Andrea Jenkyns: I congratulate hon. Members for their work in this area. As an animal rights campaigner, I think it is simply wrong that criminal damage is the highest charge that can be brought to punish someone who attacks a service animal. What are the Government doing to change the legal oversight, to protect our brave service animals, and to ensure that those who attack and injure service animals are subject to the full weight of the law?

Lucy Frazer: My hon. Friend raises a technical point about the offences that are available. In fact, there are two: criminal damage; and an offence under animal welfare legislation. Both attract a penalty of up to six months and, as she may be aware, DEFRA has identified that it is looking to increase the sentence to five years.

Prisoner Education/Reoffending Rates

William Wragg: What steps he is taking to ensure that prisoners can obtain education and skills while in prison in order to reduce reoffending rates.

Rory Stewart: To address education in prison, Dame Sally Coates’s report makes three key recommendations: first, to carry out an individual survey of a prisoner’s educational needs when they enter prison; secondly, to make sure that governors have more control over education provision to reflect the needs of the prison or local area; and, thirdly, to make sure that English and maths are a core part of that curriculum.

William Wragg: A 2017 report said that the quality of education in English and Welsh prisons was generally good, but it found that poor attendance and punctuality of prisoners often went unchallenged and that the process of moving prisoners to learning, skills and work activities from the wings was often ineffective and poorly managed. What is being done to address those problems?

Rory Stewart: It is absolutely right that there is no point having good educational provision if prisoners are not getting to the classrooms. Fundamentally we need to do two things: first, make sure that prisoners are moved reliably and predictably from their cells into the classrooms; and, secondly, make sure that the educational provision in the classrooms is sufficiently attractive for the prisoners to engage.

Barry Sheerman: I apologise for being late, Mr Speaker, but I was at the unveiling of the first statue of a woman in Parliament Square.
May we have an evaluation of how far we have got? Some years ago, when I was Chair of the Education Committee, we looked at skills training in prisons, but I do not think that much has happened since then, particularly for people on the special educational needs spectrum, and especially those with autism.

Rory Stewart: There has been a significant improvement in the Ofsted reports, but the hon. Gentleman is absolutely right that people with special educational needs, in particular, and the more than 50% of prisoners who have previously been excluded from school or have literacy challenges remain a big issue for education in prisons.

Andrew Bridgen: Does the Minister agree that one of the keys to reducing reoffending rates is ensuring that skilled probation officers have manageable case loads so that they can give enough time and energy to each individual in their care?

Rory Stewart: Absolutely. It is particularly important that there can be flexibility so that there can be a higher ratio of probation officers to high-risk cases than for low-risk cases.

Helen Goodman: It is right, of course, that prisoners must turn up, but when I visited Deerbolt prison in my constituency, the governor said that the contractor, Novus, was extremely unreliable. What is the Minister doing to respond to the report by ensuring that as contracts are rolled over, control of them is decentralised to the prison?

Rory Stewart: This is a central issue about which governors get very frustrated. Over the next 12 months, the hon. Lady will discover that we are putting governors in charge of that provision so that they can put pressure on the provider within the prison and ensure that it meets their needs.

Prisoners: Mental Health

Christine Jardine: What steps his Department is taking to improve mental health support for prisoners.

Phillip Lee: We are committed to improving the provision of and access to mental health services for those in the justice system. We continue to roll out the keyworker role across the closed male estate so that all prisoners will have a named officer to provide them with dedicated support during their sentence. As the  Minister of State, Ministry of Justice, my hon. Friend the Member for Penrith and The Border (Rory Stewart), said earlier, 14,600 prison staff have now completed at least one module of this training.

Christine Jardine: Figures show that, in March 2017, 75% of prisoners in England and Wales with serious mental health problems experienced significant delays in their transfer to hospital for treatment. Last month, an independent review of mental health assessment reported delays to transfer, with one of the reasons being the delay by the Ministry of Justice in sanctioning transfers. Given the pressure on those suffering poor mental health, surely this is important enough to require swifter action. What steps is the Minister taking to address the problem?

Phillip Lee: I became responsible last September for the unit in the Ministry of Justice that authorises the transfer of patients from the criminal justice system into secure accommodation. We have had some internal difficulties, which I inherited, with the staffing of the unit, but things are improving. I get a weekly update on the number of people in the system who need to be transferred. I am under no illusions about the need to expedite those transfers, and I am in weekly contact with the Department of Health and Social Care about the need to assess the capacity at low, medium and high-security levels in the secure accommodation network.

Probation Services: Reoffending Rates

Vicky Foxcroft: What assessment he has made of reoffending rates since the part-privatisation of probation services.

Ruth Cadbury: What assessment he has made of reoffending rates since the part-privatisation of probation services.

Rory Stewart: While the frequency of reoffending—in other words, the number of offences committed by prolific offenders—has risen since 2009, the base rate, or the number of people reoffending, has dropped by two percentage points since the introduction of community rehabilitation contracts.

Vicky Foxcroft: In 2015, the Government commissioned two important reviews: the Dame Sally Coates review of education in prisons, which was mentioned earlier; and the Charlie Taylor review of the youth justice system. Both reviews highlighted basic failures in the current system and made important recommendations. Will the Minister tell me how many of those recommendations have been implemented?

Rory Stewart: My focus has been on the Dame Sally Coates review; youth justice is dealt with by the Under-Secretary of State for Justice, my hon. Friend the Member for Bracknell (Dr Lee). The Dame Sally Coates review is driving the entire education transformation over the next 12 months, particularly in respect of the three indicators that I mentioned earlier, including the assessment of prisoners and coming up with a plan. I shall have to reply in writing to the hon. Lady’s question about exactly how many recommendations have been implemented.

Ruth Cadbury: The joint report of the inspectorates of probation and of prisons stated that if the key functions of community rehabilitation companies
“were removed tomorrow…the impact…would be negligible.”
So what exactly are we paying for?

Rory Stewart: I must respectfully disagree with that. As I have said, the base rate of reoffending has dropped by two percentage points, which is actually quite significant, as the rate was flat for nearly 40 years before that.  It would be very dangerous indeed to remove the  community rehabilitation companies, which are looking after 40,000 people who were previously under very short periods of supervision, and nearly 100,000 extra people who would be dangerous to the community if not properly monitored.

Upskirting

Gill Furniss: What his policy is on creating a specific sexual offence of upskirting.

Diana R. Johnson: What his policy is on creating a specific sexual offence of upskirting.

David Gauke: I share the outrage at the distress that this intrusive behaviour can cause to victims, and I am determined to ensure that they can be confident that their complaints will be taken seriously. I am sympathetic to calls for a change in the law, and my officials are reviewing the current law to make sure that it is fit for purpose. As part of that work, we are considering the private Member’s Bill that is being promoted by the hon. Member for Bath (Wera Hobhouse).

Gill Furniss: It is appropriate on this day to refer yet again to the statue of Millicent Fawcett, and I shall channel my inner Millicent Fawcett by asking the Secretary of State this question. Nearly 100,000 members of the public have signed a petition calling for upskirting to be made a specific sexual offence, and MPs from all the major parties have signed an early-day motion that makes the same call, so why is the Secretary of State still refusing to act? We really need to ensure that our law reflects that of Scotland, where provisions on upskirting have been incorporated in the Sexual Offences (Scotland) Act 2009.

David Gauke: Let me also acknowledge the unveiling of the Millicent Fawcett statue.
As I have said, I am sympathetic to the idea of our taking action in this regard. There are instances in which people have been successfully prosecuted for upskirting in the context of outraging public decency, and voyeurism can also apply under the Sexual Offences Act 2003. However, those offences do not necessarily cover every instance of upskirting, which is why there is a strong case for looking at the law and considering whether we need to change it.

Diana R. Johnson: I, too, am using my inner Millicent Fawcett courage to raise this issue. In Scotland, the offences of upskirting and downblousing are covered by the 2009 Act. Surely the Secretary of State accepts that the same could be done in this country.

David Gauke: We are looking very closely at the Scottish legislation and experience. It is true that a very small number of prosecutions have been brought under that legislation. I want to reassure people that successful prosecutions have been brought in England under the existing law, but I think that there is a case for making sure that we have legislation that deals with this offence specifically.

David Linden: I think that we all receive correspondence about this regularly. As other Members have done, may I encourage the Secretary of State to look at what has been done in Scotland, where we have shown leadership? The House is clear about the need for action—the will is there, so we must act.

David Gauke: We are looking very closely at how the Scottish legislation has operated to establish whether, if there is a gap, that represents a way in which we can address the matter.

Prison Capacity: South-west

Scott Mann: What assessment he has made of the adequacy of prison capacity in the south-west.

Rory Stewart: In Devon and Cornwall, as in my own constituency in Cumbria, the number of offenders is fortunately quite small in absolute terms, which means that provision is at Exeter and Dartmoor.

Scott Mann: The Minister will know that Dartmoor Prison is earmarked for closure, after notice was served on its lease back in 2013. The prison is an asset to the south-west and employs a number of my constituents. My hon. and learned Friend the Member for Torridge and West Devon (Mr Cox) is also keen and eager for the prison to remain open. Will the Minister review the decision and look at what more can be done to keep that facility open?

Rory Stewart: The decision to close the prison was based on the fact that it was built in 1805 and there are significant maintenance issues, with a great deal of damp and leaking. However, we pay tribute to the governor and the prison officers for running a very good prison regime that is popular with the prisoners, which is one thing that we will have to balance when making the final decision on the prison.

Courts: Physical Access

Gareth Snell: What discussions he has had with HM Courts & Tribunals Service on improving physical access to courts and tribunals for people with disabilities.

Lucy Frazer: I regularly meet HMCTS to discuss the court estate. It regularly reviews the estate and has monitoring systems in place to ensure that there is appropriate physical access for disabled people and, when appropriate, to identify gaps and make improvements.

Gareth Snell: If there is monitoring, the Minister will be aware that the North Staffordshire combined justice centre, which is where my constituents from Stoke-on-Trent are sent for personal independence payment appeals, has small steps and insufficient parking, and on one occasion a gentleman was asked to remove a piece of life-saving equipment so that it could be scanned by security before he entered the building. Is the Minister willing to meet Pam Bryan and John Beech from the Stoke-on-Trent and Newcastle disability network so that we can look at how the site can be made fit for purpose?

Lucy Frazer: The hon. Gentleman is right: I am aware of that. The charity he mentions—the Stoke-on-Trent Area Network for Disability—made a complaint, and HMCTS had a meeting on 5 April to discuss the issue. It is looking at the feasibility of implementing the suggestions that were made, such as putting in place automatic doors, signage and improvements to the waiting area, but I would be very happy to meet the hon. Gentleman and his constituents to discuss them.

Daniel Zeichner: Access to courts for people with disabilities will not be improved by closing courts. It turns out from the response to a written question I recently tabled that this year no Minister has visited any of the courts that are due for closure. May I implore the Minister to come to Cambridge and talk to people with disabilities to see the impact that the Government’s plans will have?

Lucy Frazer: I am always happy to meet people who use the courts service around the country. We are improving access in a number of ways, including by ensuring not only that we have court buildings, but that disabled people can take advantage of the ability to give evidence by video link so that they do not have to go to a court  at all.

Family Justice System

Tim Loughton: What plans he has to review the family justice system.

Lucy Frazer: I was pleased to meet my hon. Friend in March to discuss issues related to the family justice system, which he cares deeply about. It is important that every child has a stable home, and we need to look across the justice system to ensure that it delivers the right outcomes for vulnerable children and their families.

Tim Loughton: I was grateful for the meeting with the Minister. Does she agree with Baroness Shackleton that fault-based divorce produces uncertainty that creates an industry for lawyers and a jungle for the layman? Is it not high time for an overhaul of the whole family law system to address that and many other issues to do with couples’ rights before, after and without marriage?

Lucy Frazer: My hon. Friend makes a powerful point about no-fault divorces, as he has previously. When there is conflict within a family, it is important to reduce  that conflict in the interests of not only the parents but the children. I can confirm that we are looking actively at the issue.

Yasmin Qureshi: Our family courts are in crisis. The Ministry of Justice’s own figures show that since the removal of legal aid from the family courts, two thirds of litigants represent themselves and have no access to lawyers. They have to deal with the incredibly complex issues that arise in the family courts. Will the Minister confirm whether, as part of the review of the family justice system, the Lord Chancellor will re-establish early legal aid in such cases, which we have promised?

Lucy Frazer: The hon. Lady makes an important point. Family justice is important, because issues for children start by having a stable home and a strong family. She will know that, as part of the LASPO reviews, we will be looking at the issues she raises. I should also say that we have an online pilot at the moment relating to divorce, and it has been incredibly successful. It used to be the case that 40% of paper applications for a divorce were sent back owing to incorrect filings. That number is now down to 0.8%.

Domestic Abuse

Robert Halfon: What steps he is taking with Cabinet colleagues to provide a more efficient and accountable criminal justice system for victims of domestic abuse.

Phillip Lee: Since 2010, the Government have made tackling domestic abuse an absolute priority. Last month, the Prime Minister launched the violence against women and girls strategy at No. 10, and following on from that I attended the first roadshow event, at Edgbaston cricket ground in Birmingham, to meet victims of domestic abuse and campaigners.[Official Report, 11 May 2018, Vol. 640, c. 12MC.]

Robert Halfon: Safer Places is a remarkable and extraordinary domestic violence charity in my constituency. It has highlighted the problem of the delay between domestic violence incidents being reported and finally getting to court. What are the Government doing to reduce the time between the incidents being reported and getting to court, so that the perpetrators of this evil abuse can be brought to trial more quickly?

Phillip Lee: The police response to domestic abuse has improved in recent years, and action has been taken to address the inspector of constabulary’s recommendation that domestic abuse should be a force-wide priority. The police are referring over 19,000 more cases to the Crown Prosecution Service than they were in 2010. In the courts, the listing of cases is a judicial function, and they have a responsibility to ensure that all cases are heard by an appropriate judge with the minimum of delay.

Birmingham Pub Bombings: Legal Aid

Richard Burden: What recent representations he has received on legal aid for families of the victims of the 1974 Birmingham pub bombings.

Lucy Frazer: We have had a number of representations about this issue, many from the hon. Gentleman himself. I took part in the Westminster Hall debate on the subject, and I was pleased to have the opportunity to hear from him and many other Members. The Secretary of State also met the family of a victim recently. I understand that the recent decisions of the Legal Aid Agency are frustrating for the families, but the hon. Gentleman knows that I am unable to intervene in individual cases.

Richard Burden: As public funding has been made available to the coroner to appeal the judgment of the High Court on the naming of suspects in relation to the Birmingham pub bombings inquests, should not parity of representation be made available to the families of the victims of those bombings, to defend that same High Court judgment? If legal aid is not available to the families, why does the Minister not make funding directly available, following the example of the Hillsborough inquests?

Lucy Frazer: The hon. Gentleman makes a powerful point. This is a tragedy for all those concerned. He knows that the families have legal aid in relation to the inquest. Legislation on legal aid for judicial review and for inquests is different.

Prison Plans: Port Talbot

Stephen Kinnock: What plans he has to construct a prison in Port Talbot.

Rory Stewart: I should like to pay tribute to the hon. Gentleman for his amazingly assiduous campaign. He asked exactly the same question, with exactly the same words, at the last Justice questions, since when I have met him another half dozen times. We have had a good meeting with his constituents, and I am now aware of their individual and general concerns. However, we need prison places in Wales.

John Bercow: The hon. Member for Aberavon (Stephen Kinnock) is further evidence of the KBO principle. The Minister said what he said non-pejoratively, but I simply make the innocent and prosaic, but valid, point that repetition is not a novel phenomenon in the House of Commons.

Stephen Kinnock: Repetition can be a form of flattery, Mr Speaker. I should like to thank the Minister for meeting me and the representatives of the NPT Prison Group for a constructive discussion, and for agreeing to put plans for the Baglan prison on hold. I am sure he will also have noted the decision of the Welsh Government to put all plans on hold pending a strategic review. Can he assure me that all plans for the Baglan prison are well and truly on hold, and that the UK Government will engage in a constructive and positive manner with the Welsh Government in the strategic review?

Rory Stewart: I hope the hon. Gentleman feels that we are engaged in a constructive and positive manner and that we have very much taken on board the concerns around that site, but it is important to bear in mind that  more than 1,500 prisoners with Welsh addresses are currently being held in English prisons. We need to think about how to provide accommodation for them in Wales, because that is important for reducing reoffending, resettling them in their communities and keeping the links with their families.

Tonia Antoniazzi: Given the overwhelming evidence that smaller local prisons, where family links and the Welsh language can be maintained, are far more effective at reducing reoffending, why is the Secretary of State still proposing super prisons in south Wales when they are known not to work?

Rory Stewart: There are of course reasons why larger modern prisons are favoured, and that is partly about how we can manage things at scale. However, if there are communities in Wales that would like to come forward with proposals for smaller local prisons, I would absolutely agree that there is a strong argument for keeping prisoners closer to their homes.

Prisons: Drug Smuggling

Giles Watling: What steps the Government are taking to prevent the smuggling of drugs into prisons.

David Gauke: We have invested in improving security through the use of body searches and metal-detecting technology in every prison. We are also trialling new X-ray body scanners to reveal more hidden items. We have invested £3 million to establish national and regional intelligence units in Her Majesty’s Prison and Probation Service which, with prisons, probation and law enforcement partners, are building intelligence about the highest-risk offenders.

Giles Watling: I thank the Secretary of State for his answer. My local newspaper, Clacton Gazette, recently ran a story about the use of drones to deliver drugs into prisons. Short of shooting the damn things down, what is the Department going to do about that?

David Gauke: I thank my hon. Friend for his question and his suggestion. We are taking decisive steps to tackle drones bringing contraband into prisons. Under Operation Trenton, Prison Service and police investigators intercept drones and track down the criminals behind them. There have been at least 32 convictions to date, with those sentenced serving in total more than 100 years in prison.

Topical Questions

Rebecca Pow: If he will make a statement on his departmental responsibilities.

David Gauke: I am delighted to announce that we have met and exceeded our October 2016 target of recruiting an additional 2,500 prison officers, with 3,101[Official Report, 1 May 2018, Vol. 640, c. 2MC.] full-time equivalent staff joining the prison workforce seven months ahead of schedule, 90% of whom will be on the landings by the summer. Prison officers are some of our finest public servants, and I am happy to see  individuals seeking out a career in our Prison Service. Along with the rest of the workforce, those bright new recruits will ensure that prisons are safe and decent, tackle the unacceptable levels of drugs in prisons and cut the rate of reoffending.

Rebecca Pow: Will the Secretary of State outline what steps are being taken to secure employment opportunities for prisoners?

David Gauke: My hon. Friend is right to raise that. One of the best ways in which we can reduce reoffending is by increasing employment, which is why we have the New Futures Network coming in. I am keen to focus on ensuring that we provide employment opportunities to prisoners as much as possible.

Richard Burgon: The Windrush scandal is one of the cruellest examples of unaccountable state power targeting the vulnerable, defenceless and innocent that I can remember. Senior figures describe our immigration law as complex and unintelligible to everyone but working specialists, so I was disappointed to hear the Home Secretary say yesterday that people affected by the Windrush scandal will have “no need for lawyers”. I am sure that the Justice Secretary will understand why those words will not do, so will he guarantee today that all those who have been put into this kind of situation will have access to the necessary legal advice to help them when they need it most?

David Gauke: The Home Secretary set out a comprehensive plan yesterday for how we will make the process much easier for those who have been affected. For example, those who have retired to another country will be able to obtain British citizenship much more easily to allow them to come here without great difficulties involving visas and so on. The Home Secretary also set out how we are going to put in place arrangements to ensure that there is compensation for those who deserve it.

Richard Burgon: The Government’s reckless approach to our justice system means that criminal barristers have now been forced into co-ordinated action and are refusing to take up legal aid work due to changes to the advocates’ graduated fee scheme. Against all convention, the Government have denied parliamentary time to debate that properly. The Criminal Bar Association made a formal request that the Ministry of Justice delay, withdraw, amend or reconsider the implementation of the statutory instrument. If the Government will not listen to the views of parliamentarians, will they at least listen to barristers, put the new scheme on hold and set about fixing it?

David Gauke: On parliamentary time, my understanding is that we are waiting for information from the Labour party. On the substance of the issue, let us remember that reforms to the AGFS were worked out with the Bar Council and the Criminal Bar Association. The reforms are necessary to ensure that legal aid funds are distributed in an appropriate way, and that is why the reforms are being made.

Stephen McPartland: In the spirit of your advice, Mr Speaker, can the Secretary of State confirm whether or not the Ministry of Justice will object to the Second Reading of the Service Animals (Offences) Bill on Friday?

David Gauke: As the Under-Secretary of State for Justice, my hon. and learned Friend the Member for South East  Cambridgeshire (Lucy Frazer) pointed out, the Department for Environment, Food and Rural Affairs leads on this matter. The Government continue to look at this issue.

Alex Norris: Another week, another inquest into the death of a prisoner at HMP Nottingham. Three months on from the prison being declared fundamentally unsafe, what update can Ministers give us on the progress of the recovery plan and on the prison’s ongoing safety?

Rory Stewart: As the hon. Gentleman will be aware, there has been an urgent notification process. We have put a plan in place. I have now visited HMP Nottingham, and I pay tribute to Tom Wheatley, the governor, for the work he is doing. He has a much better care process in place, and he has highly trained staff. We expect to see improvements soon at HMP Nottingham.

Peter Aldous: In Suffolk there is a growing problem in finding justices of the peace to chair family panels, which can be complex work in which experience and local knowledge are vital. Will the Lord Chancellor give consideration to resolving the problem in the short term by extending the retirement age for magistrates?

Lucy Frazer: My hon. Friend makes an important point about the important role that magistrates play within our legal justice system. The Secretary of State told the House of Lords Constitution Committee that the judicial age in general is being looked at in the round.

Stephen Kinnock: It is me again, as I am sure the Minister is delighted to see. The Welsh Government’s strategic review has been mentioned. Can he advise on the timeframe for when he will be meeting his counterpart in the Welsh Government for these vital talks? Can he also advise on how hon. Members on both sides of the House can get involved in that dialogue?

Rory Stewart: I will be meeting the Welsh Secretary specifically on this issue next week. We are setting up a meeting with the Head of the Welsh Government, who of course will be changing, and I would very much like the hon. Gentleman to join that meeting. I reiterate that, so long as offending rates in Wales remain as they are, although it is laudable that the Welsh Government wish to divert people away from prison, we currently need places for Welsh prisoners.

Charlie Elphicke: In addition to asking the Minister whether he can confirm to the House that he has no objections to the Service Animals (Offences) Bill, may I ask what action he is taking to ensure that the justice system addresses new, dangerous and increasingly abundant drugs such as fentanyl?

Rory Stewart: Fentanyl is unbelievably dangerous and has contributed to nearly 20,000 deaths a year in the United States. We have underscored through the Crown Prosecution Service guidance for prosecuting people. Fentanyl is a class A drug, but 50 times more  powerful than other drugs. People need to understand that even a tiny quantity of this drug is a serious danger to the person producing it, to the person supplying it and, above all, to the public, and must be prosecuted.

Christine Jardine: Is the Minister aware of the looming crisis in criminal duty solicitors due to the increasing age profile? Data from the Law Society shows that in five to 10 years there could be insufficient numbers of criminal duty solicitors in many areas. Will the Government take action to address and protect this vital public service?

Lucy Frazer: I am aware of the recent document produced by the Law Society. Of course, it is important that we have professionals at every level, that we have a diverse profession and that we encourage young people to join what is an excellent profession.

Alex Chalk: The Government are entitled to feel a little perplexed by the Criminal Bar Association’s hostility to the new graduated fee scheme, given the CBA’s input into that scheme. Be that as it may, will the Minister confirm that the MOJ is prepared to communicate with the CBA to resolve this growing dispute?

Lucy Frazer: My hon. Friend is right to say that in putting together this scheme discussions went on for two years with members of the Bar and the MOJ. They were calling for us to implement this scheme, so that is the scheme we have implemented. We are always willing to talk to members of the CBA and the Bar Council. Since I have been appointed, in the past three months, I have met the chairman of the Bar Council twice and the chair of the CBA twice.

Ian Paisley Jnr: Northern Ireland has just undergone the longest rape trial in its history, resulting in the acquittal of four men. The Department is carrying out a major review of that trial because of subsequent problems flowing from it. Will the Government—the Department—make a submission to that review, particularly looking at whether the accused should not be named until after a verdict is published?

David Gauke: I thank the hon. Gentleman for his question. This is a long-standing and very sensitive issue, one my predecessors have looked at closely. We continue to look at it; there are arguments on both sides, and we need to examine the cases carefully before we rush to any judgment on this.

John Whittingdale: My right hon. Friend will be aware that last year a pilot project allowed television cameras into courts to film and broadcast sentencing procedure. Will he say what assessment he has made of that pilot and what plans he now has to extend it further?

Lucy Frazer: I know my right hon. Friend cares deeply about this important matter and he has raised it with me several times. Transparency is very important, and we are looking at the pilot. I am happy to update him, and I am looking forward to our meeting tomorrow with the Society of Editors.

Rachael Maskell: When a person spends time in custody and the CPS then drops the case against them, as opposed to losing a case in court, they are not entitled to compensation, even when they have lost their home and everything. Does the Minister agree that that is a huge injustice? Will she say what she is doing about it?

Lucy Frazer: The hon. Lady raises an interesting issue and I would very much like to discuss it with her.

Zac Goldsmith: Nick Hardwick, the former head of the Parole Board, made the case yesterday that it should be required to publish comprehensive explanations for the decisions it takes and that it should make public the names of the people who are making those decisions. May I urge my right hon. Friend to follow that advice as he undertakes his own review?

David Gauke: My hon. Friend is right to point out that I am undertaking my own review of that. The first step is to address the decision of the High Court on the existence of rule 25, which prohibits, in essence, any information being provided on Parole Board decisions. We will do that, but we also need to look more widely at how the Parole Board rules work—that includes the issues of transparency and of how the Parole Board can reconsider cases in particular circumstances.

Alex Cunningham: The troubled Holme House prison in my constituency has had another damning report, this time from the Independent Monitoring Board, which talks of a shortage of staff, a lack of appropriate care for prisoners, a sustained drugs problem, and more violence against staff and between prisoners. Things do not seem to be getting any better. Will the Minister please take an interest in Holme House and ensure it gets the support it needs?

Rory Stewart: Absolutely. The central problem in Holme House is, of course, not the age of the building—it is relatively modern—but the drugs. So the first steps we are taking are to get more scanners, sniffer dogs and staff in place. It remains a very serious problem; the connection between the drugs, the violence and the suicide in Holme House is making it a particular area of focus for this Department.

Andrew Jones: What steps are the Government taking to improve the court experience for victims and for witnesses, because it can be a highly stressful and intimidating environment?

Lucy Frazer: The MOJ is taking a number of steps to improve the position for victims and witnesses: we have introduced the ability to give evidence through video link, so people can give their evidence even before the hearing, which takes the stress out of it; and physically disabled people can give evidence by video link in another location. So we are trying to improve the Courts Service experience for everybody.

Dan Carden: Most people know my constituency of Liverpool, Walton as the home of two premier league football clubs, but I think the Minister knows it better for the two prisons: HMP  Liverpool, which was built in 1855, and Altcourse, which was built in 1997. Will he update the House on progress in the redevelopment of HMP Liverpool, and does he think that these Victorian prisons can ever be fit for purpose?

Rory Stewart: Unfortunately, as the hon. Member for Stockton North (Alex Cunningham) implied in his question, the age of a prison is not always the determining factor. We have significant challenges in relatively modern prisons. It is true in Liverpool that Altcourse has been performing better, and it is the newer prison. In Liverpool, we have provided a new multimillion pound fund for the repair of the windows across the estate, and we are looking at improving the conditions right across the estate. Stafford and Dartmoor show that it is possible to run good prisons in older, Victorian buildings.

Michael Tomlinson: I am grateful to the prisons Minister for meeting me recently to discuss the Farmer review, and I welcome his commitment to it. Will he update the House on the implementation of the Farmer review?

Rory Stewart: The Farmer review focused on the importance of families in rehabilitation. Prisoners’ links with families are central to reducing reoffending, and we have very strong evidence that when family links are kept, reoffending reduces. That means better family rooms and more family visits. In certain cases, prisons are having a lot of success piloting interactions between prisoners and, for example, the teachers of their children. All that is central, and the Farmer review is something for which we should be hugely grateful.

Judith Cummins: In October last year, the Government announced that they planned to increase the maximum penalty for death by dangerous driving. They also said that they would create a new offence of causing serious injury by careless driving. Six months on, we have still not seen any action. Will the Minister tell the House just when these vital changes will be implemented?

David Gauke: We will be updating the House in due course.

Bob Neill: A year ago, virtually to the day, the legislative provisions of the Prisons and Courts Bill, which are necessary to implement Lord Briggs’s review of civil court structure, were lost in the Dissolution of Parliament. These important reforms are pressing and needed. Can the Secretary of State update us on when the Government intend to reintroduce legislation to enable the reforms to be progressed?

David Gauke: What I can say at this point is that I think we need to bring forward a number of aspects of that to help to modernise our court system. I hope to be able to make progress on that in the coming months.

Alison McGovern: Next week will be the six-month anniversary of the publication of the report by Bishop James Jones into the experience of the Hillsborough families. The report contains many recommendations that relate to the work of the Ministry  of Justice. Will the Secretary of State explain when  we will see action from the Government on those recommendations?

Lucy Frazer: The position in relation to inquests and legal aid funding, as the hon. Lady may or may not know, is running alongside our legal aid review. I hope to be able to assure her that those matters are being looked at.

Kevin Hollinrake: One of my constituents is fighting for justice, having suffered horrific physical and sexual abuse at Medomsley youth detention centre in the 1970s. Will my hon. Friend please update the House on the likely timescales for compensation and further convictions?

Phillip Lee: I thank my hon. Friend for the question. The case that he refers to is a tragedy, and I am aware of   it. We are in the middle of the independent inquiry into child sex abuse, and the interim report is out this week. Officials from my Department are fully engaged with that, and we are conscious that in some institutions that the Department is responsible for allegations have been made that child abuse has taken place in the past. Once we have a handle on that totally, we can start talking about the possibility of compensation.

Chris Law: A failure to agree on arrangements in international family law risks leaving a serious gap in the legal framework for proceedings involving children with family connections to the UK. Can the Secretary of State confirm what contingency planning is being undertaken to deal with that risk?

Lucy Frazer: It is really important that as we leave the EU we try to get arrangements similar to those that we have in relation to our cross-border workings through our court system. Family law is one of the important matters that we need to look at. I was very encouraged to see in the EU’s recent guidance that reciprocal arrangements in relation to family are one area that they are particularly interested in.

YEMEN

Stephen Twigg: (Urgent Question): To ask the Minister of State for International Development to update the House on the humanitarian situation in Yemen.

Harriett Baldwin: The UK is deeply concerned about the humanitarian crisis in Yemen, which is the largest humanitarian crisis in the world. More than 22 million people—over three quarters of the population—are in need of humanitarian assistance. The UN estimates that 17.8 million people in Yemen do not have reliable access to food and that 8.4 million face extreme food shortages. Last year, the country suffered the worst cholera outbreak ever recorded in any country in a single year.
At the Yemen pledging conference in Geneva earlier this month, the Minister of State for the Middle East announced £170 million of support to Yemen this year from the UK. That funding will meet the food needs of 2.5 million Yemenis. Last year, the UK was the second largest donor to the UN’s humanitarian appeal for Yemen. Our funding provided more than 5.8 million people with at least a month’s supply of food, nutrition support for 1.7 million and clean water and sanitation for approximately 1.2 million people, but money alone will not be enough. We must see sustained progress on the response to this year’s cholera outbreak; we must see payment of public salaries to millions of civil servants and their dependants; and we must see unhindered humanitarian access into Yemen. The UK has led the way here, too, lobbying and advising all parties to take the life-saving steps to prevent further deterioration of the crisis.
We are aware of reports over the weekend of significant civilian casualties resulting from coalition airstrikes. We take those reports extremely seriously. The Saudi-led coalition has confirmed that it will carry out an investigation. It is essential that that happens without delay, that the results are published and that the lessons learned are acted upon. Our hearts go out to the families of those killed. We call on all parties to comply with international humanitarian law. A political settlement is the only way to bring long-term stability to Yemen and to address the worsening humanitarian crisis. The Yemeni parties must engage constructively and in good faith to overcome obstacles and to find a political solution to end the conflict.

Stephen Twigg: I thank the Minister for her response.
Last week, the UN special envoy to Yemen, Martin Griffiths, briefed the Security Council on reports of a sizeable military offensive. He said:
“the prospect of intensive military operations in Al-Hodeidah, long heralded, may soon be forthcoming.”
He went on:
“Our concern is that any of these”—
military—
“developments may, in a stroke, take peace off the table.
There have been a number of missile attacks on Riyadh by the Houthis, many of which have been intercepted, but one last weekend resulted in a Saudi casualty. Saudi Arabia has the right to protect its territory  and its people from these attacks. However, Hodeidah is one of the two major entry points for aid into Yemen. Any military offensive would cause an already catastrophic situation to deteriorate further. Will the Minister assure the House today that the UK is doing everything it can to prevent such an offensive by the Saudi-led coalition from taking place? Surely, if an attack on Hodeidah goes ahead, the UK would have to suspend arms sales to the Saudi-led coalition.
The UK has been supporting the coalition by providing targeting training for its air force. By the Ministry of Defence’s own figures, 42 potential violations of international humanitarian law by the Saudi-led coalition were recorded in just three months at the beginning of this year, compared with 66 incidents over the whole  of the past year. Will the Minister set out what the value of our training is when the rate of civilian casualties is increasing, not decreasing?
Finally, as the Minister rightly says, what Yemen needs is peace and a political settlement. This conflict will not be solved by further violence. May I implore the Government to bring a resolution to the UN Security Council as a matter of urgency? Eight million people in Yemen are on the brink of starvation. Surely the United Kingdom has a responsibility to lead the international community to put peace on the table.

Harriett Baldwin: I congratulate the hon. Gentleman on securing today’s urgent question and finding time to discuss these important issues on the Floor of the House. He is absolutely right to pay tribute to the work of Martin Griffiths. As the hon. Gentleman will know, the UK holds the pen on this matter at the United Nations, and it is really important that Martin Griffiths has been appointed as a United Nations special envoy. As colleagues will know, he brought the debate to the floor at the United Nations last month. The UK strongly backs his work, and his outline of the process that will lead to a political solution and peace in Yemen. In fact, I am glad to have the opportunity to reiterate a point that he made: we urge all parties to the conflict to exercise restraint and continue to facilitate access for essential imports of food, fuel and medical supplies into the country, including through Hodeidah and Saleef ports. I agree that further military action is not the way forward. The way forward towards peace is around the negotiating table.
The hon. Gentleman made some points about the important role that the UK can play in the peace process, in addition to the role as penholder at the United Nations. Clearly our role is also to be a candid friend to those involved in the Saudi-led coalition; to encourage the process of the investigative joint incident assessment team and the publication of its reports, 55 of which have been published so far; to recognise that the UK is not involved in any way in the targeting chain; and to reiterate the importance of the UK having the most rigorous export controls, which involves the observation of international humanitarian law.

Desmond Swayne: Is the Minister absolutely convinced that President Hadi is not an impediment to a political settlement?

Harriett Baldwin: I will not fall into the temptation of commenting on any of the individual players concerned. Clearly, President Hadi needs to be involved in the discussions about the way forward. The United Nations  special envoy, after publishing his outline and road map towards peace in Yemen, will need to engage a wide range of counterparties.

Kate Osamor: I thank my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) for asking the urgent question, and the Minister for responding.
The situation in Yemen is as dire as ever, with millions at risk of famine, the worst cholera outbreak in human history and the alarming prospect that Hodeidah port may soon become a conflict zone. The Houthi political leader, Saleh al-Sammad, was reportedly killed in a bombing last week. What impact does the Minister think that this will have, and what steps is she now taking to reopen dialogue on a ceasefire with the new Houthi leadership and Saudi Arabia?
Last week in this Chamber, the Minister for the Middle East admitted that the level of humanitarian access was not as great as he would wish. Fuel and food imports are not enough and port access remains unpredictable for traders and aid agencies. Just yesterday, appalling images emerged of an airstrike hitting a wedding party. Twenty people were tragically killed and 45 more were wounded. The bride was killed and the groom taken to hospital.
Time and again, the Government imply that this suffering will happen with or without the UK. Well, surely now is the time to make it very clear that Britain will not be complicit. Will the Minister tell us whether the UK Government insisted on full, permanent, humanitarian access in Yemen and an end to the bombing of civilian areas before signing the £100 million aid partnership with Saudi Arabia last month? In the light of the weekend’s appalling airstrike on the wedding party, will the Government now finally suspend their arms sales to Saudi Arabia?

Harriett Baldwin: I thank the hon. Lady for her questions, which allow me to reiterate some of the points that I made to the hon. Member for Liverpool, West Derby. Yes, I do think the UK has an important role to play, particularly as the pen-holder at the United Nations. That is why we are strongly backing Martin Griffiths, the new special envoy for the peace process in Yemen. We believe that that is the most constructive route whereby the UK can engage all the participants in this conflict and send a common message to all of them that the way forward is not through bombs or missiles but through peace discussions, and very much in the way that he has outlined in his reports to the United Nations. The UK is proud to support his office and the tools that he needs to help with this.
As the hon. Lady will know, we are very involved with the United Nations’ role in inspecting ships going into Hodeidah port and reassuring participants that they are purely for humanitarian aid. The UK is also playing a role through the United Nations team that is trying to prevent access for the missiles that are being used to shoot from Yemeni territory into Saudi Arabia, risking the lives of civilians within Saudi Arabia as well. I do think that the UK is playing a constructive role in all these matters. That includes the Secretary of State travelling to Riyadh in December to take practical steps in terms of access to the port for humanitarian aid.

Bob Stewart: Could the Minister describe the mechanism or system by which our aid gets taken from where it arrives in-country to the people who most need it, presumably by convoy? How do we ensure that this aid actually gets to the people towards whom we have targeted it?

Harriett Baldwin: This is an opportunity to pay tribute to all the humanitarian workers in all the conflict areas of the world who very often take such risks in delivering humanitarian assistance to some of the most conflict-affected parts of the world. My hon. Friend will be aware that in all areas where humanitarian aid is delivered, it can sometimes be caught up with different players in the conflict. Obviously we take every kind of precautionary measure through the United Nations to prevent this from happening, but it is still too often shockingly the case that some of this humanitarian assistance gets taken into situations where it is used as part of the conflict. That is one of the very many dangers that we highlight, and it is why we want to ensure that humanitarian workers around the world have safe access to provide their life-saving aid.

Chris Law: Many of us woke up this morning to see the horrific images of yet another airstrike by the Saudi-led coalition that has targeted innocent people, this time a wedding party in northern Yemen killing at least 20 people, including the bride. Of course, this is not new. Shockingly, of the 17,000 airstrikes since the war started, one third have hit non-military targets. The whole House should quite rightly condemn Saudi Arabia and its coalition for targeting innocent people.
Does the Minister agree that the UK Government’s selling 48 fighter jets to Saudi Arabia only last  month, bringing total arms sales to £4.6 billion since the beginning of the war, makes the UK complicit in these atrocities and undermines the Government’s international development spend in Yemen? At the very least, will the UK Government commit today to fully and finally halt all arms sales to Saudi Arabia? Will she set out how the UK Government will influence Saudi Arabia to bring about a meaningful political solution to the war in Yemen?

Harriett Baldwin: Clearly, the UK is saying to all sides in this conflict that the way to secure peace is through political dialogue, including on the side of the Houthis, from Yemen into Saudi Arabia, but also through ensuring that international humanitarian law is respected in this conflict. The hon. Gentleman will be aware that this matter went to the UK High Court in 2017, and the High Court ruled in favour of the UK’s conclusion that Saudi Arabia does have processes in place to secure respectful compliance with international humanitarian law. He will also be aware of United Nations resolution 2216. We say to all the parties in this conflict that the way forward is not through bombing and missiles; it is through the political process that the United Nations special envoy has set out.

Pauline Latham: My hon. Friend mentioned the largest cholera outbreak since records began, but the aid community is also struggling to cope with the largest diphtheria outbreak since 1989, with over 1,000 cases of this highly infectious  disease. Young children are enduring the brunt of this outbreak: 90% of fatalities are under the age of 15. In an environment where more than half of all health facilities are closed or partially functioning, there has been a surge in child mortality driven by communicable diseases and chronic malnutrition. What more can this country and others do to make sure that medicines and nutrition get to the people who need them?

Harriett Baldwin: My hon. Friend raises a very important point. The UK welcomes the approval by the Yemeni authorities in Aden allowing the import of oral cholera vaccines, which should allow 400,000 doses to be administered in southern Yemen. Discussions on vaccinations in the rest of the country are continuing. The partnership with UNICEF in Yemen is allowing UK aid to be spent on vital immunisations against other outbreaks, including diphtheria, as well as helping to train staff on the ground on how to deal with new cases.

Tom Brake: First, I join calls from the Opposition Benches for arms sales to Saudi Arabia to be suspended, and echo the condolences to those killed in the wedding party.
The Ministry of Defence has previously confirmed that British forces are in the Saudi-led coalition operations room to provide training and advice
“on best practice targeting techniques to help ensure continued compliance with International Humanitarian Law.”
What went wrong? Was this latest strike in compliance with international humanitarian law, and what are its humanitarian consequences?

Harriett Baldwin: Of course, we welcome the fact that the Saudi-led coalition has acknowledged that a full investigation needs to take place to answer the questions that the right hon. Gentleman has asked. We urge that that investigation happen as quickly as possible. It does need to be published so that lessons can be learned.

Bob Blackman: My hon. Friend rightly refers to the outbreaks of cholera and other diseases. The United Kingdom can be rightly proud of the aid that we are giving. What plans does she have to ensure that there is a supply of clean water to people who are suffering so that the diseases are not spread and people are not forced to drink dirty water?

Harriett Baldwin: My hon. Friend raises an incredibly important way in which UK aid is used—to provide clean water on the ground. We would reiterate the same access requests that we have made previously, because it is vital that the relevant water purification tablets find their way to people so that they can be reassured that the water they are drinking is not going to make  them ill.

Ann Clwyd: The Minister keeps talking about political dialogue, but who are we having the political dialogue with? We have debated this many times in the Chamber over the last three years, and things have just got worse in Yemen. Today, 22 million people need humanitarian and protection assistance, including more than 11 million children—that is 4 million more people than was the case six months ago. A child  is dying every 10 minutes in Yemen from preventable diseases, and yet the blocking of the ports and airports continues. What exactly is the Minister doing and who is she talking to?

Harriett Baldwin: It is vital that the discussions include all the people who can move this situation from one where we are observing a conflict to one where we have a peace process under way. My understanding is that the United Nations Security Council presidential statement adopted on 15 March was unanimously supported by all involved. It calls on all parties to the conflict to comply with their obligations and for the solution to be fully inclusive.

Henry Smith: The current situation in Yemen is not just a civil war or a sectarian conflict; it is also in many ways a proxy war between Saudi Arabia and Iran. In addition to diplomatic pressure being brought to bear on Saudi Arabia and the Gulf states, what pressure is being brought to bear on the allies of Tehran and that side of the conflict?

Harriett Baldwin: My hon. Friend is correct to point out that it is thought that the missiles being fired into Saudi Arabia from Yemeni territory are predominantly being supplied by Iran. I reiterate that the UK is trying to work with the United Nations to prevent that and to prevent use of the routes that might be being used to supply those weapons. It is important that all parties call on those supplying the arms to cease.

Anna Turley: The Minister referred to the fact that Saudi Arabia is going to conduct an inquiry into the tragic events of the weekend, but surely the British Government should now support a fully independent United Nations-led investigation into violations of human rights on both sides in Yemen?

Harriett Baldwin: We welcome the fact that the Saudi-led coalition has committed to an investigation, and it is important for that to be published in the very near future.

Edward Argar: The hon. Member for Liverpool, West Derby (Stephen Twigg) was right to highlight that the immediate and most pressing priority is the alleviation of humanitarian suffering in Yemen, and the Department for International Development should be proud of its work in that area. He also highlighted that, alongside Saudi Arabia’s legitimate right to defend itself and support the legitimate Government of Yemen, it must, like all parties to the conflict, show restraint in its actions. Can the Minister reaffirm the UK Government’s strong position that what we need alongside humanitarian aid is a multilateral ceasefire to which all parties to the conflict simultaneously sign up?

Harriett Baldwin: I can confirm that that is why the UK is so strongly backing the United Nations special envoy who has recently been appointed and the work he is doing to outline a plan of action and to engage all participants in that process.

Caroline Lucas: The Minister acknowledges that Yemen is the largest humanitarian crisis in the world, so why are the UK Government via  their arms sales choosing to make that awful situation even worse? How can we have any moral standing on the world stage while we continue to sell arms to the head-chopping, war-mongering Saudi Government? Of course we need to have diplomatic relationships, even with countries we do not agree with, but surely to continue selling arms to a Government who are essentially committing war crimes is beyond the pale, even for our own Government.

Harriett Baldwin: The hon. Lady will know that under United Nations resolution 2216, there is a legitimate reason for Saudi Arabia to be concerned about the fact that missiles are being fired on a regular basis into its territory. But she is right that the way forward is for all parties to engage in the political process, and that there is no military solution to the current conflict in Yemen.

Rebecca Pow: I commend the commitment that the Government have already given to humanitarian aid in Yemen, but heavy rains will hit Yemen shortly, and the cholera crisis will get worse, together with the other awful diseases that are a consequence of having not enough water and unsafe water. Can the Minister expand on when extra aid will get there and exactly how it will get to the people who need it? Getting into the right places is extremely difficult.

Harriett Baldwin: My hon. Friend is right that this is not just about the money. This month’s pledging conference attracted a wide range of people who were prepared to contribute to funding the humanitarian effort, but it is also essential to ensure that the improvement in access does not slip back. We are concerned to maintain the role we have played both through the United Nations and bilaterally in ensuring that humanitarian access is as good as it can be.

Richard Burden: The recent ghastly attack on the wedding party is not the first atrocity on civilians. Markets, schools and hospitals have been hit by coalition airstrikes in a civil war that has already claimed 10,000 civilian lives. As my right hon. Friend the Member for Cynon Valley (Ann Clwyd) said, that has created a humanitarian crisis in which a child is dying from a preventable disease every 10 minutes. Can the Minister answer the question put to her by my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg): is it not time for the UK as penholder to call for a new United Nations Security Council resolution to ensure unimpeded access to Hodeidah and other ports?

Harriett Baldwin: The hon. Gentleman is right to reiterate the important role that the UK can play as penholder, which is why we so strongly support Martin Griffiths’ recent appointment as the UN special envoy on this situation. There was a United Nations Security Council meeting in March on this very subject. He is outlining the way forward in terms of engaging all parties to this conflict in discussions, and that has the wholehearted support of the UK at the United Nations.

Kevin Foster: I welcome the UK’s support for the UN verification and inspection mechanism, which is helping to speed up the inspection of ships   delivering vital supplies to Yemen. However, does the Minister agree that that process needs to be speeded up even more if the people of Yemen are to get the supplies they so desperately need?

Harriett Baldwin: My hon. Friend raises a very important detail. The UK has great expertise in maritime matters, and we have deployed experts to Djibouti to help with that inspection process. In fact, UK support has helped to increase the proportion of ships that have been physically inspected by almost 10 times, from 8% to 77%.

Alison McGovern: May I press the Minister a little further? She gave a long answer a moment ago to my hon. Friend the Member for Birmingham, Northfield (Richard Burden) about a UN Security Council resolution. Exactly when can we expect to see one?

Harriett Baldwin: The UK led the drafting in March of the United Nations Security Council presidential statement, and as I understand it, that statement, which calls on all parties to comply with their obligations under international humanitarian law and to facilitate humanitarian access, and emphasises the need for an inclusive political solution, was widely supported.

Philip Hollobone: The fundamental cause of the misery in Yemen is the Iranian-backed Houthi insurgency, which has blighted the lives of tens of millions of people. I have not yet made it to Yemen, but I made it to within a kilometre of the border in Saudi Arabia—a visit I declared in the Register—and there I learned that something like 70,000 rockets and over 50 Scud missiles have been fired from Yemen into Saudi Arabia, and 50,000 people have been evacuated. Saudi Arabia has the right to defend itself. We need to get this in perspective, because although at the moment there is no chance of any kind of political dialogue, I would rather that Hodeidah port was in the hands of the coalition, which would increase the chances of aid getting through to these benighted people, than that it remained in the hands of the Houthi insurgents.

Harriett Baldwin: My hon. Friend is right to highlight the perspective of those people who are on the receiving end of missiles fired from within Yemen, and he allows me to reiterate that United Nations resolution 2216 speaks of that. I disagree to some extent with my hon. Friend, in that I do not think that further military conflict is the way forward. We think the way forward is through the political process, backed by the United Nations special envoy.

Luciana Berger: Liverpool is home to many of the Yemeni diaspora in the UK, and the plight of family members who are suffering in Yemen is a constant anxiety and pain to many of my constituents. I have listened closely to the Minister. In the light of the presidential statement from the UN Security Council, may I ask her specifically, as that was at least a month ago, whether she believes that a resolution is now urgently needed to permanently open all naval ports and airports to both humanitarian and commercial traffic, and if so, what is the UK going to do as penholder to achieve that?

Harriett Baldwin: The hon. Lady is right to say not only that these discussions are ongoing, but that they must be pursued with enormous urgency. I can assure her that the work that the special envoy is engaged upon has that urgency at its heart, and involves the UK wholeheartedly backing the way in which he is taking forward engagement with all the parties to pave the way for further steps.

Alistair Carmichael: I am sure I was not the only person who was struck by the Minister saying that we would be a candid friend to the Saudi-led coalition. With one third of the 16,847 air- strikes hitting non-military targets, surely we have now come to the time for a bit more candour and a bit less friendliness. Continuing to sell arms to Saudi Arabia is like giving more booze to an alcoholic; it is something that no proper, true or candid friend should be doing.

Harriett Baldwin: The hon. Gentleman is absolutely right to highlight the important role that the UK can play in being able to use the strong relationship that we have to raise these difficult decisions and difficult issues more effectively. For example, most recently, in March, during the visit of the Saudi Crown Prince Mohammed bin Salman, the Prime Minister was able to raise exactly these serious UK concerns about Yemen.

Nick Smith: Like my hon. Friends, I reiterate that every 10 minutes a child dies from preventable causes in Yemen. Will the Government give priority to the reopening of Sana’a airport, to help alleviate this desperate situation?

Harriett Baldwin: Among the work that the UK is doing, I particularly highlight the work that we have done through Djibouti, in terms of shipping access to Hodeidah, but it is something that we are monitoring very carefully. As the hon. Gentleman is aware, only about two thirds of the humanitarian assistance that Yemen needed got through in March, and so far in April it seems to be an even lower percentage, so it is something that we are paying very close attention to.

Graham Jones: I am grateful to my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) for asking this urgent question. I think we all agree that what happened in Hajjah was absolutely shocking. It is not a first, and such killings continue in a war that has seen a lot of individuals killed. There needs to be a clear process of accountability; otherwise, the killing will simply continue. I welcome Martin Griffiths as the new special envoy. He has talked about a peace process, but let us not forget that recently Ismail Ahmed, the outgoing UN special envoy, said that the Houthis had walked away from a peace deal. My question to the Minister is how do we get a peace deal when the Houthis walked away from the Kuwait talks and the Geneva talks and Ismail Ahmed said they walked away from the talks at the back end of 2017? How do we get these people around the peace table?

Harriett Baldwin: As I said, negotiations and the special envoy’s work are ongoing, and I thank the hon. Gentleman for his support for his role and the work that he is doing, but no one should underestimate the difficulty of the task that he has been asked to undertake.

Joanna Cherry: One of the terrible consequences of this conflict is that there are millions of internally displaced people in Yemen. The Minister is aware that Christian Aid is campaigning very volubly on that issue. How will the UK Government’s approach to the United Nations compacts on refugees and migrants address the particular needs of internally displaced people in Yemen?

Harriett Baldwin: I cannot give the hon. and learned Lady a specific response. She has drawn my attention to a particular detail, on which I will have to respond in writing.

Gill Furniss: According to Save the Children, there are now over 22 million people—that is two thirds of the population—in Yemen in need of humanitarian aid and protection. That includes more than 11 million children. That is 4 million more people than six months ago. The situation is only getting worse. Does the Minister agree that it is in part a result of the failure of this Government to pursue an end to this with the vigour required? Surely, now is the time to get together, as the penholder, another UN resolution, and to suspend arms sales to Saudi Arabia.

Harriett Baldwin: I draw the hon. Lady’s attention to the points that I have made earlier. It is important that the UK backs the work of the United Nations special envoy.

Wes Streeting: The UK’s ability to uphold the values of a rules-based international system will be undermined unless the UK is shown to call Saudi Arabia to account for its indiscriminate bombing of civilians in Yemen. So I ask the Minister, as so many other colleagues have today, to treat with urgency the need for a new UN Security Council resolution to make sure that all ports in Yemen are open to humanitarian aid to deal with the catastrophic situation already in place on the ground. Finally, if the Government of Saudi Arabia are not prepared to show appropriate restraint when exercising the country’s legitimate right to defend itself, I ask that the UK Government be prepared to––and will––suspend arms sales to Saudi Arabia.

Harriett Baldwin: Of course, in addition to backing the work of the United Nations special envoy, the UK will continue to maintain the very rigorous combined arms sales criteria, in terms of arms exports from the United Kingdom.

Jonathan Edwards: White phosphorus burns at 815 °C, and to the bone if it comes in contact with human flesh. Is its reported use as an incendiary weapon in Yemen considered by the British Government to be a chemical attack, and if not, why not?

Harriett Baldwin: The hon. Gentleman highlights, as did other hon. Members, the need for rigour in the process of investigating all these incidents and, in the case of those that come from the Saudi-led coalition, the importance of encouraging the joint investigative team to adopt a process that makes it possible to publish those reports very quickly.

John Woodcock: During our visit to Saudi Arabia over the Easter recess, we were able to put the UK’s concerns about the humanitarian catastrophe to the King, and in detail to his Ministers and officials. Will the Minister update the House on the block on the funds that have been deposited by Saudi Arabia in the Central Bank of Yemen, which are much needed? May I also gently say to her that it surely did not aid the cause of peace that she did not mention Iran and its pernicious role in the conflict until she was asked by her Back Benchers?

Harriett Baldwin: The hon. Gentleman raises an important issue. It allows me to welcome the fact that Saudi Arabia and the United Arab Emirates pledged between them some $930 million in humanitarian assistance at the Geneva conference earlier this month. However, as many colleagues have pointed out, it is important that it gets through.

Peter Grant: Saudi Arabia has every right to defend itself, but what it is doing in Yemen goes way beyond self-defence. When one of the world’s wealthiest, most heavily armed and most highly trained military machines kills civilians in every one in three attempts, we have to accept that this is no accident; it is deliberate, unrestrained slaughter of civilians. I understand why the Minister cannot publicly criticise arms sales to Saudi Arabia. It is very noticeable that, despite being asked by nearly every Member on the Opposition side of the House, she has not yet personally defended those arms sales. Is that because, in conscience, she knows that they cannot be defended?

Harriett Baldwin: I have said numerous times that the UK maintains rigorous arms export control criteria, and one of those must be that at the time of export there are no concerns that the arms will be used in contravention of international humanitarian law. Again, this is an opportunity for me to emphasise how important it is that the Saudi-led coalition publishes the joint investigative assessment team’s reports, and to welcome the fact that 55 reports have been published so far.

Lloyd Russell-Moyle: The UK is not meant to sell weapons to countries when there is a clear risk that they will kill innocent civilians or break international humanitarian law. We sell 50% of all our weapons to Saudi Arabia, and 61% of all the killings have been the result of Saudi and coalition airstrikes. What is the Government’s red line on breaking international humanitarian law? When will we stop licensing the killing of innocent civilians?

Harriett Baldwin: The hon. Gentleman might even be a member of one of the Committees involved in this, so he will know exactly what the wording is for our arms exports criteria. We have heard from other colleagues about the missiles that are being fired into Saudi Arabia, and this allows me to reiterate—perhaps in conclusion, Mr Speaker—that a political solution is the only way forward to bring long-term stability to Yemen.

David Linden: rose—

John Bercow: The Minister was approaching her peroration, but she has not yet completed it; she has one further opportunity to expatiate, because we have a further inquiry, from Mr David Linden.

David Linden: Thank you, Mr Speaker. The Minister talks about the UK being a penholder at the United Nations, but part of the problem is that we give the pen to Saudi Arabia so that it can write us cheques in exchange for arms. I want to ask her this question not as an MP speaking to a Minister, but at a human level. When she sees images of children clinging to their dead parents, does she not realise that it is time to end the arms sales to Saudi Arabia?

Harriett Baldwin: What I can say is that the hon. Gentleman rightly draws to the House’s attention how this conflict is harming the lives of so many, and why it is so important that the UK backs the work of the United Nations special envoy in taking forward the discussions that can lead to a political solution that will bring peace to Yemen.

CAPITA

Vincent Cable: (Urgent Question): To ask the Minister for the Cabinet Office if he will make a statement on the financial position of Capita.

Oliver Dowden: I genuinely welcome this opportunity to update the House on Capita’s announcement yesterday, which covered its 2017 full-year results, the launch of a £701 million rights issue and an update on its transformation programme. As I have told the House repeatedly, private companies can answer for themselves, but the Government’s priority is the continued delivery of public services. As we demonstrated with regard to Carillion, we have continued to deliver public services without interruption.
The House will recall that I came here in February when Capita initially announced the rights issue. Capita confirmed yesterday that it is proceeding in line with that previous announcement. The House might be interested to know that Capita’s statement yesterday announced that underlying profit before tax is £383 million for 2017, which is in line with market expectations; that, as a result of the rights issue, it has made a £21 million contribution to reducing its pensions deficit; and that, as a result of the announcement, the market reaction was a share price rise of over 10% on the day.
Capita’s board and auditors have confirmed that the company will continue to have adequate resources to deliver on its obligations, supported by its rights issue and other steps designed to strengthen its business. The rights issue is underwritten and the required shareholder vote will take place in early May. Management have confirmed that the key shareholders fully support their plan. In addition, the company has suspended dividends until it begins to generate positive cash flow; it expects to generate at least £200 million in 2020. The impact of all this has been to reduce dividends and shareholder returns in favour of other stakeholders. This, once again, is evidence of shareholders taking the burden, not taxpayers.
I understand that Members remain concerned about outsourcing companies, following Carillion’s liquidation. However, we must be clear that Capita has a very different business model and financial situation; it is not a construction business and it has minimal involvement in private finance initiatives. The measures that it has announced are designed to strengthen its balance sheet, reduce its pensions deficit and invest in core elements of its business. As I said in February, arguably these are the measures that might have prevented Carillion from getting into the difficulties that it did.
It remains the position, as I said in February, that neither Capita nor any other strategic supplier is in the same position as Carillion, but I would like to reassure the House that officials in my Department and I continue to engage regularly with all strategic suppliers. It is in taxpayers’ interests to have a well-financed and stable group of key suppliers, so we welcome the moves that the company announced yesterday.

Vincent Cable: The public will clearly be deeply concerned that yet another major Government contractor has been in financial distress, following Carillion and earlier service problems with Serco and G4S. Capita is  not a construction company, but given that we are dealing with IT services that affect literally millions of people—for example, in relation to tax credits, disability testing and benefits, the congestion charge, the BBC licence fee and Army recruitment—what contingency plans has the Minister put in place since he was informed that the company’s losses are not sustainable? Is there a Crown representative in place? Have new contracts been stopped? Since the new chief executive announced cuts of £175 million a year, to make savings for the new company, how far have these been discussed with the Government, and how far have they a bearing on the provisions of those highly sensitive services? In the light of this development and earlier developments with Carillion, what steps have the Government taken to reform the system of Government procurement, so that we do not have companies low-balling to win contracts that then make losses, and to break up some of the contracts, so that we are not over-dependent on a handful of financially fragile companies?

Oliver Dowden: I thank the right hon. Gentleman for his questions. I will seek to address them all, but please forgive me if I miss any. I will come back to him in writing if I do.
On the company’s overall position, it is important to understand that what has happened is exactly in line with what was announced back in February, so there is not really a new development. The company’s underlying position, as it has said publicly, is that it has about £1 billion of cash that it can call upon.
The right hon. Gentleman asks about the Crown rep. I confirm that the Crown rep is Meryl Bushell. I met her this morning and continue to engage with her, as I do with all the other Crown reps.
The right hon. Gentleman asks whether new contracts had been awarded. Since the statement in February, no new contracts have been announced by central Government. However, I understand that the BBC and authorities in Northern Ireland have announced contracts.
The right hon. Gentleman asks what we are doing to break up the system of Government procurement. I always ask, with every contract that crosses my desk to be authorised, whether we have broken it up into as many small pieces as possible to make it accessible for small businesses. Over the Easter period, I made an announcement to help us meet the very challenging target we have set of 33% of all business going to small or medium-sized enterprises. We set a target of 25% in the last Parliament and met it. I announced a range of measures to help us towards the 33% target. I wrote to all the Government’s key suppliers saying that I wanted them to appoint an SME representative to try to drive business to SMEs. I have required all their subcontracting over the value of £25,000 to be published on the Government’s Contracts Finder. I am consulting on ways to improve prompt payment to make it a condition of business being awarded to strategic suppliers. That is very important to SMEs, and I am looking at ways to give them a right to go over the top of key suppliers  to the Government to give them a right of recourse.
I say gently to the right hon. Gentleman that both he and I have a proud record from our time working for the coalition Government—he at a much more senior level, running the Department for Business, Innovation and Skills. In line with other Governments, we continue  to award contracts to Capita. The House may be interested to know that of the major central Government contracts that have been awarded to Capita, about 20% were awarded under Labour, over half under the coalition Government and 27% under this Government. This issue does not to relate to one party over another.
The reason we do it is that we know outsourcing delivers efficiencies. According to one survey, we receive efficiencies of at least 11%. If we get efficiencies of 11%, that means more money to spend on health, more money to spend on education and more money to spend on core services. That is why the Labour Government did it, why the coalition Government in which the right hon. Gentleman served did it and why this Government continue to use outsourcing.

Bernard Jenkin: Does my hon. Friend agree that there is something of a correction going on throughout the sector, as it adjusts to the effects of the Carillion collapse and to the perhaps over-tight margins that some contracts have imposed on providers? I draw his attention to the fact that the Public Administration and Constitutional Affairs Committee is doing an inquiry into the lessons to be learned from the collapse of Carillion. Personally, I take confidence from the fact that the investors have decided to trust Capita with £700 million more of their capital to secure the long-term future of the company.

Oliver Dowden: I thank my hon. Friend for his question. He is absolutely right that what we discovered yesterday was that the rights issue is proceeding exactly as planned. In terms of the overall market, I have tried to be clear all along that suppliers should expect a decent rate of return—not an excessive rate of return, but one that allows them to run a profitable business, while ensuring that there are savings for the taxpayer. That is why we use private companies. It is not because of ideology; it is because they deliver savings to the taxpayer, which means more money to be spent on health, education and other public services.

Chris Matheson: May I thank you, Mr Speaker, for granting the urgent question and congratulate the right hon. Member for Twickenham (Sir Vince Cable) on securing it?
Capita is one of the strategic suppliers to the Government, providing services of particular strategic importance, yet, as we heard from its boss today, it had no strategy aside from mucking up the management of the dental register, leaving hundreds of dentists to stand idle; failing to maintain the primary care support service in England, which supervises GP and patient records; and failing on the Army recruitment contract, among many other failings. Members have been highlighting those and other failures to the Government over a period of years and will not be surprised at the latest news. I echo the call from the right hon. Member for Twickenham for the Minister to outline what contingency plans he has put in place to deal with a possible default on any one of those contracts.
The Government claim to be monitoring the situation and have a Crown representative in place, but do they even know what they are monitoring if they are not sure about the number of contracts Capita runs? I and other Members have asked for a list of Government contracts  undertaken by Capita and have not been provided with one. Do the Government know how many contracts Capita undertakes across central Government and, indeed, across local government? Will they publish a list of all those contracts?
Will the Minister confirm what improvement plans have been agreed with Capita since its string of profit warnings or yesterday’s refinancing? What quality thresholds will be built into Government contracts to ensure that Capita and other privateers reach an acceptable standard of service delivery, particularly in view of their precarious financial situation?
This latest episode in the saga of outsourcing scandals again shows the public that the Government’s commitment to this practice is nothing more than ideological. Despite the danger to public services, along with the treats to Capita’s staff and subcontractors, the Government will not shift from their view that these giant multinational firms should make huge profits from the public purse, until the point when they fold, taking our public services with them. The Government act as though these firms should be allowed to privatise the profit of the public sector, while nationalising the risk to the British public. We need a change in direction now. Will the Minister use this latest episode involving Capita to finally introduce a presumption in favour of in-house provision of public services?

Oliver Dowden: I have a great deal of respect for the hon. Gentleman, and he could have done a little better than some of the overblown rhetoric in his contribution. Yesterday’s announcement was entirely in line with market expectations.
The hon. Gentleman asks what is being done in relation to strategy. The strategy has been set out clearly by the new chief executive. It includes a revised divisional structure and executive team to better manage and enhance services and client value, as well as a rights issue, which, as I said, has proceeded as planned and will materially improve the company’s financial stability, thereby reducing its debt, enabling it to invest in core services, allowing it to reduce the pensions deficit, which it has done by £21 million—I hope all Members will welcome that fact—and allowing it to reduce its cost base.
The hon. Gentleman asks what contingency planning the Government are doing. As I have said, we undertake appropriate contingency planning in respect of all our strategic suppliers. I take a close personal interest in that as a Minister, and I know that the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office takes a similarly close interest in it.
The hon. Gentleman asks about contracts that have been awarded to Capita, so let me give him the numbers. Of the current major central Government contracts that have been awarded to Capita, nine were awarded under Labour, which is 20%, 24 were awarded under the coalition, which is about 53%, and 12 were awarded under the current Conservative Government, which is about 27%. This is not a party issue; all three formations of government have decided to use outsourcing companies.
To conclude, I had thought that the hon. Gentleman would agree with the words of a previous Labour leader and somebody who many regarded as being, at least in some senses, a successful leader. Gordon Brown, hardly a rabid right-winger, said:
“It simply would not have been possible to build or refurbish such a number of schools and hospitals without using the PFI model.”—[Official Report, 14 November 2007; Vol. 467, c. 665.]
That was a sensible Labour Government who were committed to delivering public services. We do not see such sense from the current Labour party, I am afraid.

Mark Francois: While I agree with the thrust of the Minister’s response, I am afraid I have to tell him that a serious blot on Capita’s record is the Army recruiting contract. Capita does not have much experience in that area and has been underperforming very seriously on the contract for some five years. I told the House in Defence questions yesterday that it is now known universally in the Army as “Crapita”, because of its poor performance on the contract. Will the Minister accept it from me that, although nobody wants to see Capita go bust because of all the jobs that would be lost, equally we cannot have an Army without recruits? Therefore, this is one contract that Capita, honourably, should hand back.

John Bercow: I must tell the right hon. Gentleman that his second reference to the rather unfortunate nickname of the company concerned has just caused some merriment among school students in the Public Gallery. They clearly found it very funny, as did I, so the right hon. Gentleman may be a celebrity among those students—not to mention, of course, in his constituency and in many other parts of the country.

Oliver Dowden: My children are aged six and eight, and on the off chance that they happen to tune into this later, I will make sure that I do not repeat that word, because I would not want to hear it around our breakfast table.
I know about the commitment of my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) to this issue; he is absolutely right to raise it. We all know that there have been problems with Capita, but I can update him and the House by saying that the MOD and Capita have agreed an improvement plan under their contract. I understand that Capita is looking to deliver on that plan, so I am confident that it is making steps in the right direction, although I do not deny that there have been problems in the past.

Drew Hendry: A £701 million rights issue after a £530 million loss, with a scramble to recover reputation after damaging contract bungles, is indeed indicative of a business with no strategy. Given the wide range of public services involved, is the Minister at all worried by the situation? If so, what precautions has he put in place to protect people’s jobs? Does he agree that this highlights a role for the public sector in providing vital public services? Given that he is wedded to the PFI model, will he take the time to look closely at the Scottish Government’s Scottish Futures Trust model, which has saved the Scottish Government £1 billion?

Oliver Dowden: I thank the hon. Gentleman for his questions. As I have said, Opposition Members keep trying to characterise this as ideological, but the fact is that Governments of all colours have used outsourcing. Why? Because they know that that can deliver savings. It is just the same as when private companies use outsourcing so that they can focus on their core businesses.
The hon. Gentleman asks whether I take a close interest in this—yes, I take a close interest in all our strategic suppliers. On a weekly basis, I receive updates on the position and on the plans that we have, if necessary, in relation to all our strategic suppliers. However, I restate to the House that Capita’s position is not the same as Carillion’s—nor, indeed, are any of the other strategic suppliers in that position.

Dr Caroline Johnson: Does my hon. Friend agree that the Labour party is interested only in the ideological pursuit of renationalisation at any cost? What matters to the public is that they get the best services at the best value to the taxpayer.

Oliver Dowden: My hon. Friend’s raises a very important point that is another rebuttal to this idea of ideology. If we want to look at ideology, perhaps the number of PFI contracts signed by a Government would give an indication of that, so let us look at the numbers. How many contracts did Labour sign on average each year? Fifty-five at the peak. How many have this Government signed in the past year? One. If this is about an ideological commitment to the use of the private sector, Labour Members should search their souls in relation to their last Government.

Meg Hillier: The Minister makes great play of the 11% savings from contracting out, but it is no good making savings if core services are not being delivered well. Will he outline how many of the contracts he is concerned about—he has listed them a couple of times—and will he tell us how many contracts he is discussing with Capita with regard to whether their delivery should be reviewed? It is no good spending taxpayers’ money on a private company if it is not delivering the services that it is paid to deliver.

Oliver Dowden: The contracts that each Department agrees with the private sector for the delivery of services are very stringent. Each Department is responsible for ensuring their proper delivery, and if the company is not delivering properly, it will be in breach of the contract and remedies will be available. At the point of re-letting a contract, we look at the overall performance of the company concerned to ensure that it is in a fit state to be able to deliver on its promises. There is a dual responsibility between the individual Departments, which set out the terms, and the Cabinet Office, in which I sit, which has overall responsibility for the supplier market.

Matthew Offord: Barnet Council has a significant contract with Capita. It also has a business continuity planning framework that monitors liquidity and indebtedness. It reviewed the situation twice last year, and again after the recent profit warning, and the company was shown to be far from reaching  the relevant threshold for triggering any action, but in the local elections, the Liberal Democrats are using the issue to scaremonger. I urge the Minister not to take advice or direction from someone who undersold Royal Mail by £1 billion and then called the loss “froth”.

Oliver Dowden: I thank my hon. Friend for his question. Tempting though it is, I shall resist the urge to comment on the Royal Mail deal, but I refer him again to the—  [Interruption.] When the Department was controlled by the Liberal Democrats, I do not think the right hon. Member for Twickenham (Sir Vince Cable) would have taken kindly to a Conservative special adviser getting too heavily involved.
I refer my hon. Friend the Member for Hendon (Dr Offord) to statistics that demonstrate that over half of the contracts that were given to Capita were awarded under the coalition Government, in which the Liberal Democrats played a sterling part. If they want to play politics, I refer them to those statistics.

Rachel Reeves: May I push the Minister on contingency planning because I fear that the Government are being a bit complacent about that issue? Since Carillion went bankrupt, hospitals in Sandwell and Liverpool have been mothballed. What confidence does he honestly have that if Capita were to go the same way as Carillion, its contracts would continue to run and these crucial public services would continue to be delivered? The experience of Carillion is that that is not happening.

Oliver Dowden: I gently disagree with the hon. Lady, who has a great deal of expertise in this area. Public services have continued to be delivered without interruption. There is a specific question about the PFI contracts in respect of those two hospitals, but I reassure her and other hon. Members, who I know take an interest in this, that we are taking a very close interest in the matter. We are engaging with NHS Improvement and the Department of Health and Social Care to try to resolve this as quickly as possible and ensure that we have a clear plan for the delivery of the hospitals.

Bob Stewart: Obviously I support outsourcing in principle, but I am really concerned. If Capita is reviewing the way it operates—it has operated abysmally in various spheres, particularly Army recruiting, as my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) said—are the Government reviewing how they have oversight of these contracts so that we can get more effective feedback and problems can be corrected quicker?

Oliver Dowden: I thank my hon. Friend for his question. He is absolutely right to raise the issues that we have had with the Army recruitment contract, but what is happening demonstrates that the Government are engaging with these problems. The MOD and Capita have agreed an improvement plan, which seeks to address some of the significant problems that we have. When these problems arise, we are engaging with the companies concerned to try to deliver improvements.

Catherine West: What assessment have the Government made of the impact on apprentices who are employed in Capita’s many workplaces? How many individual apprentices may be affected? Which regions of the UK are particularly exposed? What contingency plans are in place to protect potential losses to the apprenticeship programme, and what will be done to stop these failing business practices? I am fed up of having to listen to poor apprentices in other companies who have lost their roles as a result of failing business practices.

Oliver Dowden: I reassure the hon. Lady that the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office is taking a very close interest in this and working in respect of all those apprenticeships. At the moment, those apprenticeships are ongoing, but clearly we need to look at how we can manage their future so that young people do not find themselves disadvantaged. I can assure the hon. Lady that this is a top priority for my right hon. Friend.

Stephen Kerr: The Minister says there have been problems with Capita, and while Capita and Carillion are different businesses in different situations, they have something in common: the businesses are both big and complex. What steps are the Government taking to involve more small and medium-sized businesses in the delivery of public services?

Oliver Dowden: My hon. Friend raises a very important point. It is right on two levels that we have a diverse supply market: first, because the more suppliers we have, the less we are at risk from the loss of any one supplier; and, secondly, because small and medium-sized enterprises are the backbone of our economy locally and nationally, creating 16 million jobs, and I am determined to ensure they get their fair share of such contracts. That was why I announced a range of measures over Easter, including providing subcontractors with a right of access to buying authorities in order to report poor practices. It was also why the Prime Minister wrote to every Secretary of State requesting that they appoint an SME champion. I want the message to go out to all SMEs—I spent a lot of time over Easter meeting small businesses and communicating this—that they can bid for and win government contracts. Go on to Contracts Finder, find them, and bid for them!

Kelvin Hopkins: In my two decades in the House, I have opposed PFI schemes root and branch from the beginning. It seems that the number of PFI agreements has dwindled to virtually zero, so it looks like the Government agree with me now. A number of public authorities are now insourcing and making financial gains as a result. Will the Government encourage that process, which would save public money? Will they also not hand out lucrative public contracts to Capita to help it out of its present circumstances?

Oliver Dowden: I shall resist the suggestions of Front-Bench colleagues; I do not think I will ever convince the hon. Gentleman to cross the Floor, despite his warm words.
We reviewed PFIs and introduced the new private finance 2 contracts, which removed many of the excesses we saw under the last Government. The hon. Gentleman asks about the rewarding of new contracts. Since the statement in January, as I said, no contracts have been awarded to Capita by central Government. Two have been awarded by the wider public sector—by the BBC and Northern Ireland authorities.

Bob Blackman: My hon. Friend will recall that Capita developed from the public sector in the first place. Does he agree that the use of outsourcing not only controls costs and gives gains to the public, but provides certainty over the standards of service provided to the public? If an outsourced company fails to deliver to those standards, the contract can be recalled and given to an alternative provider.

Oliver Dowden: As ever, my hon. Friend and neighbour is absolutely correct. That happens regularly, and it is exactly why private companies all use outsourcing to provide services such as cleaning and site security—because they can use specialist providers and because that delivers savings. He talks about how the Capita model arose. I remind Labour Members who are getting overexcited that Capita was founded by Sir Rod Aldridge, who was a major donor to not the Conservative party, but the Labour party.

John Spellar: May I associate myself with the comments about Army recruitment made by the right hon. Member for Rayleigh and Wickford (Mr Francois) and the hon. Member for Beckenham (Bob Stewart)? Does not the Minister accept that Capita is only the latest outsourcing company to be in trouble? With some, including probation, hospital and rail companies, having to hand back contracts and the growing crisis in the over-leveraged, offshored care industry, does he not question whether there are not actually deep systemic problems with the Government’s dogma-driven privatisation model?

Oliver Dowden: I simply fail to understand how Labour Members can say that this is dogma-driven when the last Labour Government awarded 55 PFI contracts a year and one was awarded in the last year. Some 20% of the contracts awarded to Capita were awarded by the Labour party. This is not about ideology; it is about what works. Outsourcing delivers savings, which means that we have more to invest in the public sector—more in our schools; more in our hospitals.

Michael Tomlinson: May I give the Minister an opportunity to repeat and reinforce his message about small businesses and the importance of their getting more involved in the delivery of public services? Will he encourage businesses in my constituency and the wider Dorset region to bid for contracts?

Oliver Dowden: My hon. Friend is absolutely right. Small businesses should be going out there and bidding for Government contracts. I know that his constituency has much expertise in the aerospace sector, and I announced further measures over Easter to help such small businesses. I wrote to all our strategic suppliers asking that they adhere to the prompt payment code, and I am requiring suppliers on large contracts to provide their subcontracting data. They can be under no illusion that the Government are watching closely to ensure that in terms of contracts from government itself and subcontracting, SMEs get their fair share.

Wayne David: I welcome the Government’s recognition that Capita is not delivering on its contract for Army recruitment, but rather than   Capita simply introducing an improvement plan, would it not be better for the Government to consider bringing contracts back in-house so that Army recruitment is conducted by the Army? That is what the Army wants.

Oliver Dowden: As the hon. Gentleman has acknowledged, I have answered the question about the Army recruitment contract, and I shall not repeat my answer, but I would say that we are not driven by an ideological approach. If services can be delivered better in-house, of course they can be delivered in-house, but in the majority of cases, for contracts such as cleaning and security, both the private and public sectors have found that they get cheaper services that are just as good quality when they outsource. That is the right decision to make.

Mike Amesbury: Capita employs hundreds of people in my constituency at a place called Preston Brook. What discussions have the Government had with recognised unions, such as the Communication Workers Union, about the job and pension security of those workers?

Oliver Dowden: The hon. Gentleman raises a very important point. I can reassure his constituents, as I have done repeatedly at the Dispatch Box today, that yesterday’s announcement was in line with expectations. Capita is not in a similar position to Carillion. I can also reassure them that, as a result of the rights issue yesterday, a further £21 million has been paid down into the pension fund, meaning that their pensions are more secure as a result of the announcement on Monday.

Stephen Lloyd: The Minister has spoken several times in glowing terms about the importance of the SME sector. One of the issues that came out of Carillion’s collapse was the deplorable reality that it often did not pay its SMEs their subs for 120 days, and sometimes more. That is the way to destroy the SME sector. Given that this is taxpayers’ money, will he give me a guarantee that that is not happening at Capita and that people are getting paid within a fair and reasonable time?

Oliver Dowden: The hon. Gentleman is right to raise the issue of prompt payment, and I know that various Select Committees are looking into the Carillion case. My right hon. Friend the Secretary of State for Business, Energy and Industrial Strategy is sitting next to me, and the Chancellor announced in the spring statement a call for evidence on the prompt payment code, which governs such payments. The Government pay about 96% of our contractors within 30 days. As I said, I have written, post Carillion, to all our strategic suppliers to re-emphasise the importance of adhering to the code. We are consulting on how to exclude suppliers if they do not do so.

GKN

Greg Clark: With your permission, Mr Speaker, I shall make a statement about the takeover bid by Melrose Industries plc for GKN plc. On 29 March, Melrose announced that holders of 52% of GKN shares had accepted its offer, and as of last Friday, the figure had reached 88.5%.
As I informed the House on 27 March, the Enterprise Act 2002 sets out three circumstances in which a takeover can be referred to the Competition and Markets Authority on public interest grounds. They are financial stability, media plurality and national security. Any such reference must take place within four months of the completion of the transaction, and must result from a quasi-judicial decision, made impartially, on the basis of an open mind and solely on the evidence presented. No grounds were advanced for a reference on the grounds of media plurality or financial stability. To inform my decision on national security, I asked for a comprehensive assessment to be made by the Ministry of Defence and other bodies concerned with our national security.
The Secretary of State for Defence has written to advise me that the MOD has completed its detailed analysis and has agreed with Melrose a set of undertakings, specifically: to ensure that the Government are informed in advance of any plans to divest a business, a component of a business, or assets which engage in activities that the Ministry of Defence considers to have national security implications; to ensure that the Government have early visibility of any prospective purchasers, including structures of consortia and persons holding significant influence and control; to prevent the disposal of the relevant business, components of a business or assets without the consent of the Government; to ensure that the Government receive suitable protections from any subsequent purchaser in the event of any future sale of elements of the business; to ensure the continuation of contractual obligations to protect intellectual property and classified information; to ensure the continued maintenance of any capabilities with a national security dimension; and to provide the MOD with powers to inspect information and facilities to ensure the protection of classified information.
Those undertakings are combined with the undertakings that Melrose agreed to make in response to my letter of 26 March, including undertakings not to dispose of the aerospace business for at least five years without the Government’s consent; to maintain a UK stock exchange listing for at least five years; to ensure that the business remains headquartered in the UK, and that a majority of directors are resident in the UK; to ensure that both the aerospace and Driveline divisions retain the rights to the GKN name; and to guarantee that spending on research and development will take place on at least GKN’s previous level, amounting to a minimum of 2.2% of sales for the next five financial years. In important respects, those undertakings go beyond commitments given by the previous management team. Melrose has also agreed to meet my officials and me every six months to provide updates on its ownership of GKN.
On the basis of the commitments given relating to national security, the Ministry of Defence concluded that statutory intervention was not required. That is consistent with the other assessments that I have received. On the basis of the assessments that I have considered and the undertakings that have been entered into, my judgment is that there are not reasonable and proportionate grounds to make a statutory intervention on the grounds of national security.
GKN is a very important business, performing  vital work in industries—aerospace and automotive in particular—with an expanding global market in which British innovation and excellence offer great opportunities. This takeover bid has entailed a vigorous debate about which of the two alternative British managements could most credibly reap those opportunities. The shareholders chose—initially by a small majority, and finally more substantially—new management. All UK public companies are subject to that challenge of how they can best be run: it is an essential part of the competitive business environment for which Britain is renowned.
The takeover bid has been important in wider ways. It is the first contested bid in which the new regime of legally binding commitments on future conduct has applied. The commitments that have been made reflect the strong interest of stakeholders—including employees, UK taxpayers, suppliers, and research and development partnerships—in knowing the future intentions of a bidder, provided in a way that is binding. These responsibilities, which broadly reflect those placed on directors of ongoing businesses by section 172 of the Companies Act 2006, are important to ensure that the longer-term and strategic interests of our economy are considered and addressed during takeover bids.
Now that such an ability to make post-offer undertakings has been established, I expect them to be implemented. The new management’s stewardship of these important businesses carries with it important responsibilities for our economy and our country. I look to the management to honour its commitments in both the spirit and the letter, and to create a strong future for GKN, its employees, its suppliers, and the industrial sectors in which it will play a major role.
I gave the House a commitment that I would carry out my legal responsibilities seriously, meticulously and fairly, and that I would keep the House up to date at every phase of these proceedings. I believe that I have done so, and I commend my statement to the House.

Rebecca Long-Bailey: I thank the Secretary of State for giving me advance sight of his statement.
There are two issues that I must raise today: the fact that the reported assurances obtained by the Government, both in the letter of 27 March and subsequently, are not sufficient to guarantee the security of the long-term prospects of the company and, indeed, the workforce; and the inadequate capacity of the takeover regime to protect companies outside the very limited grounds of national defence, media plurality and financial stability.
First, as I made clear last month, the assurances obtained by the Government in Melrose’s letter of 27 March were sadly inadequate. Apart from the first five assurances which were post-offer undertakings, what  was in the letter was completely unenforceable. For example, there were no post-offer undertakings on maintaining employment or tax residency, which could easily constitute such undertakings. Indeed, the maintenance of employment is vital to our national security, and the loss of these jobs will cause the diminishment of vital skills that are integral to our defence industry.
Putting aside issues of enforceability, what of the assurances that have been reported since 27 March? The reported veto power that the Secretary of State for Defence has to stop the sale of certain businesses will not, I am afraid, solve the national security problem. Melrose reportedly has a short-term outlook which undermines the long term that is required for defence projects. That is important, and a veto on the sale of certain parts of the business by the Defence Secretary will not help significantly. Sadly, the Government’s failure to address the short-term horizons of Melrose may damage the capability of a business to deliver projects that could last for 10, 15 or 20 years.
Secondly, our takeover regime is inadequate, and the Secretary of State is acutely aware of that. If a takeover falls outside the grounds of national defence, media plurality and national stability, the Secretary of State cannot act, even though the takeover may be harmful for the business, harmful for employees, harmful to research and development, and harmful to supply chains.
Let us take the case of Unilever. Last year it was threatened with a takeover, and there was nothing that the Government could do because the takeover fell outside the three public interest exemptions. Unilever has since commented on the inadequacy of the UK takeover regime, and its recent decision to place its headquarters in the Netherlands was, as reported by the Financial Times, arguably driven by a desire to escape the poor safeguards for takeovers in the UK. Labour Members have called on the Government to broaden the public interest test. The measures that that the Government have proposed so far are not good enough. We know that, in GKN’s case, they already had the power to act and did not do so. However, our takeover rules would not have prevented Unilever from being taken over had Kraft been prepared to follow through, because that had nothing to do with any of the three exemptions.
I agree with the Secretary of State that our takeover regime must be open enough to encourage foreign investment, but it must also protect against short-termism and long-term damage to our economy and national security. Arguably, too often it is short-termism that prevails. Only this week we heard reports that the hedge funds that bought GKN shares to make Melrose’s takeover possible are now targeting Melrose, shorting the company on the stock exchange.
What we needed from the Secretary of State today was not just a waving through of the deal, but action, both in obtaining concrete assurances from Melrose on the future of GKN and its workforce, and in the form of clear plans to reform and widen our takeover regime to protect British businesses. I fear that the short-term predators already smell their next victim—and it is not just Melrose; it is Britain’s industrial future.

Greg Clark: Right from the outset, the hon. Lady has been unable to advise us of what specific undertakings she thought it was appropriate to obtain. She needs to  understand that as this is a quasi-judicial decision, the statement that she made that she would block the bid would disqualify her from making that decision, as the right hon. Member for Twickenham (Sir Vince Cable) knows to his cost.
The evidence presented to me was that this was a British company taking over another British company, that no such takeover has ever been blocked on national security grounds, and that the Ministry of Defence and the other agencies said there was no reason for intervention on those grounds. I have to tell the hon. Lady that the previous directors of GKN themselves said that there was no reason for an intervention on national security grounds. She should reflect on the commitments that the Defence Secretary and I have secured to retain the aerospace division for at least five years, to ensure that the Government have the right to approve any future sale of any defence business or asset, and to invest in research and development to at least the current level. Not once in the past four months has she engaged in a similarly forensic way to set out what she thinks would be appropriate commitments.
The hon. Lady says that the commitments are inadequate, but they have been given as legal deeds and in some cases set out to the Takeover Panel as post-offer undertakings. The truth is that she has had the opportunity to engage with this matter, but having prejudiced her position by saying from the outset that the takeover should be blocked, she has given away the ability to have influence on what the regime should be.
The hon. Lady knows perfectly well what the Government’s powers on takeovers are, because the 2002 Act was passed under a Labour Government and sets out those limited powers, which are the same as in the rest of Europe. The difference between the Government and the Opposition is that when we came into government, we reformed those powers to allow post-offer undertakings to be given, so the situation when Kraft bid for Cadbury and undertakings were reneged upon cannot happen in the current circumstances. We have taken an active approach to ensuring that all stakeholders’ interests are secured, whereas the hon. Lady preferred to float above it all and simply say no before considering the evidence. We have proceeded responsibly, and she would do the employees of and stakeholders in GKN a service if she engaged more forensically in future.

Desmond Swayne: What are the sanctions if commitments are not honoured?

Greg Clark: Sanctions with regard to undertakings to the Takeover Panel are those for contempt of court, which include everything up to imprisonment.

Drew Hendry: I thank the Secretary of State for advance sight of his statement.
The Secretary of State mentioned holding Melrose to the spirit and letter of its commitments, but traders have been short selling £725 million, or 17%, of Melrose stock, effectively betting against it making a success of GKN. What action will he take if there is any breach of the spirit or letter of the commitments?
The Secretary of State did not cover jobs in his statement. I asked him following a previous statement to what extent he would require assurances to prevent  assets from being stripped and jobs lost, and not just those in the MOD or national security. What assurances has he had on the financial restructuring involved in the takeover, which will mean more debt and less investment at the core of GKN? How will that situation progress the Government’s industrial strategy, and can he explain how allowing the takeover will protect the skilled jobs that we require and tackle productivity issues?

Greg Clark: I am grateful to the hon. Gentleman for his questions. He will know that one undertaking that has been given is a commitment to at least five years of research and development investment, including participation in the joint industry bodies, which have been a successful part of our arrangements in the aerospace and automotive sectors and are an important part of our industrial strategy. That is a valuable commitment that I would have thought the hon. Member for Salford and Eccles (Rebecca Long Bailey) and he would welcome.
The previous GKN management criticised the commitment to retain the aerospace business, saying that it should not have been entered into given that the sell-off of GKN’s automotive business had already been agreed to. It constitutes a longer-term commitment than was made during the latter period of the previous ownership.
The hon. Gentleman will understand that in obtaining commitments from a bidder, I have to bear in mind commitments that the incumbent management have or have not made. No commitments had been made on the total number of jobs, and indeed the sale programme involved a majority of the business. One of the features of today’s results announcement was that the debt of the previous business was higher than anticipated, and the plans that the new management have set out include paying it down.

Lucy Allan: I thank the Secretary of State for his statement and welcome the undertakings that he has secured.
The future of GKN was determined by speculators who came on to the share register in the final weeks of the bidding process to make a quick profit. Does the Secretary of State agree that that is no way to determine the future of a great British manufacturing company, and will he now conduct a review of the takeover code to ensure that speculators cannot participate in that way in a vote to decide a company’s long-term future?

Greg Clark: I understand my hon. Friend’s concern, and a number of hon. Members have raised that point before. There are a couple of things to say about it. First, most people who have bought shares latterly during the takeover process bought them from longer-term shareholders, and one way in which a bid can be backed is for people to sell before the end point of that bid. That situation was looked at, appropriately, by Professor John Kay, who published a substantial review. His panel noted that one suggestion was that voting rights should accrue only if people had been on the share register for a specified period. The Kay review concluded:
“We were persuaded that the introduction of such provisions by legislation or regulation would involve practical difficulties and would be unlikely to achieve the intended effect.”
That was an expert review by a serious person, but of course in all circumstances such as this we keep our corporate governance arrangements under review, and I will certainly do that now.

Rachel Reeves: I would like to follow up on the point that the hon. Member for Telford (Lucy Allan) raised. Other countries have a rule that people must have been shareholders for a certain period before they can vote on a takeover deal. Some sort of financial transaction tax would also reduce short-term speculation in companies that leads to their being taken over in this fashion. I urge the Government to look again at the takeover code, particularly for businesses that are so integral to our industrial strategy and have received a lot of taxpayer funding, in this case for the R&D work that GKN has undertaken.

Greg Clark: I am glad that the hon. Lady mentions the R&D work, which is very important. The commitments that have been made on R&D, both to keeping up investment and to participating in R&D partnerships, are extremely important. She and her Business, Enterprise and Industrial Strategy Committee asked for undertakings to be given on that and a number of other issues, and were not satisfied with the undertakings that were offered. I persuaded the company to go further and obtained undertakings relating not only to national security but to R&D and the ownership of businesses, and I hope she will acknowledge that that is valuable.
On the hon. Lady’s point about differential voting rights for shareholders, I mentioned the John Kay report, which her predecessor Committee scrutinised—I think the right hon. Member for Twickenham (Sir Vince Cable) gave evidence backing the report’s judgment. I know that her Committee is correctly interested in keeping our arrangements up to date, and if she and her colleagues want to review these matters, what their predecessors said is a good example of how that can be done.

Jack Lopresti: I congratulate my right hon. Friend on his statement, and on the work he has done on this difficult issue, especially in relation to securing the five-year guarantee for the aerospace business, which is unprecedented for a business such as GKN. Indeed, as he has just said, the last management refused to countenance such an arrangement. I visited the plant in my constituency a week or two ago and, despite some cynical scaremongering by some in the party opposite, the management and workers there are optimistic about the future and looking forward.

Greg Clark: I am grateful to my hon. Friend for his comments. It seems to me that when we establish a regime of post-offer undertakings, it is necessary to be active and to apply ourselves to the undertakings that it is important to secure. It is true that there has never been any commitment to own an important business such as that for more than five years, and I think that this will be valuable and welcomed by the employees in his constituency. I recognise his assiduousness in visiting the plant and talking to his constituents who are employed there.

Vincent Cable: Further to the excellent intervention from the hon. Member for Telford (Lucy Allan), the Select Committee Chair, does the Secretary of State accept that the role of the short-term  investors has been highly destabilising? They acquired 20% of the stock, they forced the takeover through and they are now short selling. If he is not persuaded of the merits of differential voting, how does he propose to deal with this problem?

Greg Clark: The right hon. Gentleman was not persuaded either. He commissioned a report, he had a respected and eminent individual look into this, and he gave evidence to the Select Committee to say that he was not persuaded. I have described some of the circumstances involved. Those who bought shares in the latter stages bought them from people who had decided they did not want to back the existing management. He knows that I take a great interest in ensuring that our regime of corporate governance is the best in the world. The fact that people can invest here with confidence forms an important part of our reputation. We have been successful over many years, and of course if the Select Committee wants to review the experience since the report that he commissioned, it has the ability to do that and I would be very happy to participate.

Rachel Maclean: The Minister will be aware that the global headquarters of GKN are in Redditch, and that this has been my first priority ever since we heard the news of the takeover. Is he also aware that I spoke to Melrose on Friday, and that it assured me that it has no plans to shut the Redditch office? It believes that many of the jobs will be reabsorbed into the functions of GKN. Does he agree that that is really good news, and contrary to some of the things we have heard in the media? Will he also comment on observations in the media about the Airbus relationship? Again, we have heard that the takeover could have a negative impact in that regard, but that is not what I have heard from Melrose, which thinks that the relationship could continue. Can he comment on that further?

Greg Clark: I congratulate and applaud my hon. Friend on being active and engaging with the new management to talk about the important headquarters function in her constituency. She has indeed secured good news from the company in that respect. I understand that the divisional heads of the aerospace and automotive businesses have been reappointed by the new management. Let us bear in mind that the incumbent management’s proposal was, latterly, that the automotive business should be sold, and that it would now be in the process of being sold. Airbus is clearly an important company, and there were some comments ascribed to it, although I do not think that they have been repeated. It will be important for the new management to set out its plans, so that all suppliers can have confidence in those relationships.

Geoffrey Robinson: Is the Secretary of State aware that short selling has been the decisive factor in this, and that that is a matter of great concern throughout the House? Also, he has rightly been concerned about the reputation of Melrose Industries plc for taking short-term measures. It cuts, closes and sells on at a profit. That is its reputation and, as far as I am aware, that is what it has invariably done. He has therefore sought longer-term undertakings—and five years is a significant period—that will keep the plants going and ensure that the company redoubles its commitments. However, his statement contained no  indication as to whom those commitments are to be made, except presumably the Takeover Panel. What powers does the panel have to impose binding sanctions or, if necessary, to take the company through a legal process that he claims in his statement will be legally binding? On these crucial issues, he seems to have made no progress at all.

Greg Clark: This is the first time that any such commitment has been given on the ownership of assets for a period of five years. I have been active in establishing this regime, and I think the hon. Gentleman knows that, in my engagement with manufacturing and other industries, I have considered carefully the strategic importance of continued investment and stability. In the final analysis, there was a greater commitment to stability of ownership from the bidder than there was from the incumbent management. On the question of enforceability, I will place in the Library of the House the deeds that have been entered into in favour of the UK Government by the company. Some of them are under the Takeover Panel regime. As I said to his colleague on the Labour Front Bench, the effect of this new regime is that there will be sanctions up to imprisonment for a breach of those undertakings.

Stephen Kerr: I welcome the encouragement that my right hon. Friend gave to the Chair of the Business, Energy and Industrial Strategy Committee to look at the issues surrounding this takeover, and I am sure that the Committee will do that. Importantly, he also pointed out that this was a contest between two British management teams. Does he agree that the British taxpayer should expect companies that receive public money, either through contracts or through research and development, to be prepared to give an undertaking to take a long view when it comes to investment decisions?

Greg Clark: That is right, and I would also welcome consideration of these matters. Right from the beginning, I have made a commitment to the House that I would take a considered, comprehensive view and use the powers that I have, and that where I did not have statutory powers, I would say what I expected. When it comes to research and development, to the ownership of assets and, for today’s purposes, to national security, a long-term commitment is required, and it has been important to obtain undertakings in all those areas. I hope that the Committee will take a look at this.

Frank Field: In his statement, the Secretary of State said:
“GKN is a very important business, performing vital work in industries—aerospace and automotive in particular—with an expanding global market in which British innovation and excellence offer great opportunities.”
Does he understand from his regular meetings with Melrose that it is thinking of adapting its business model so that these vital interests can be kept for a longer term than they would otherwise have been? If not, would this British company consider selling first to another British company?

Greg Clark: I am grateful to the right hon. Gentleman for his question, because I wrote and said that deliberately. I regard this company, operating in the sector that it does, as having an important long-term role. One of the reasons that there was a vigorous contest for this business  was the recognition that there are immense opportunities involved. It is my purpose as Business Secretary to ensure that we reap those opportunities. That is why I requested what was in effect a change to the previous commitments that this company or any other had made, and I was able to do that on the aerospace side. As I said in response to the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), it was clearly not possible to extract another commitment on the automotive business, given that the incumbent management had committed to selling it forthwith. In the spirit of what the right hon. Gentleman has said, I think that he will reflect on what has been obtained for the first time in the UK takeover—namely, a commitment to a much longer-term perspective than had been the case, including the right for the British Government to approve any subsequent purchaser of defence assets—and agree that that is a significant step forward.

Bim Afolami: I draw the House’s attention to the fact that, in the dark days before I came to this House, I spent several years in the City advising on mergers and acquisitions, and Melrose was one of the companies that I advised several times. Bearing that in mind, while there is of course a narrow range of scenarios in which the Government can intervene on a quasi-judicial basis, as the Secretary of State has already set out, will he confirm whether the Government will always ensure that we have an open globalised economy based on competition, not one in which politicians will capriciously intervene, which would be the approach of the Labour party?

Greg Clark: That is the right approach. The UK’s reputation for being a dependable place to invest and do business is based on clear rules and principles, and we have benefited from that. We make significant investments in the UK economy, we make significant investments in overseas companies, and we hold big assets. That is important to us, and we should be a trading nation, which means that we should be open to investment as we invest in other countries. That is the heart of our approach. However, it is important to keep the regime under review, and where there are long-term interests, such as in research and development, it is right that we have introduced an ability during a takeover bid to extract indications of how a bidder would approach things. That is what we have done in this case.

Jack Dromey: It is a bleak day for British industry and British workers when a 259-year-old icon of British engineering excellence falls prey to a hostile takeover thanks to hedge funds moving in to make a quick killing. We will hold Ministers and managers to account for the promises that they have now made. Crucially, does the Secretary of State agree that the time has come for a fundamental review of our corporate takeover regime, because the idea that the British national interest can be sold down by the river by hedge funds moving in to buy 20% of a company is fundamentally wrong?

Greg Clark: The hon. Gentleman talks about employees’ interests, and he has fulminated about the bid for a company that has an important plant in his constituency,  but he has not made a single request or proposed a single safeguard to protect those interests. I do not know whether he has met the new management of GKN—I do not think he has—but my hon. Friends the Members for Filton and Bradley Stoke (Jack Lopresti) and for Redditch (Rachel Maclean) have made the effort and have discussed the important commitments that are being made, and the undertakings that I have secured will contribute to employment stability. The difference between my hon. Friends and the hon. Gentleman is that they have rolled up their sleeves and got involved, whereas he has contented himself with making slogans from the Back Benches.

Mark Francois: The aerospace division is the jewel in GKN’s crown and is a vital part of Britain’s defence industrial base, so as a former Ministry of Defence Minister, I particularly welcome the guarantees that have been provided about the future of that part of the company. Will the Secretary of State say a little more about how he has worked closely with the MOD on that? Will he also assure us that the MOD will be a part of the six-monthly reviews?

Greg Clark: I will indeed, and I am grateful to my right hon. Friend, who speaks with considerable authority not just as a former MOD Minister, but as an ex-serviceman. Defence considerations are important, and I work closely with the MOD, which has provided a comprehensive assessment. That is the proper basis on which those with expertise in such matters can say what is required to safeguard national security, and I promised this House that I would abide meticulously by the expert advice that I receive. I am glad that I have had access to that expertise and have made my decision based on it. Of course, when it comes to considering the future opportunities for this company, our engagement through the industrial strategy is as important in the defence sector as it in the automotive and civil aerospace sectors.

Richard Burden: The Melrose takeover of GKN was approved by 52% to 48% after 20% of the company had been snapped up by hedge funds. The Secretary of State has heard calls from both sides of the House for those with short-term interests to be excluded from making decisions on takeovers and for the public interest test to be expanded to include questions about research and development. He has rejected those calls today, but he says that he keeps matters under review. What form will his review take, and when does he expect it to report?

Greg Clark: On the hon. Gentleman’s first point, I have said to many colleagues in the House that when it comes to shareholdings, every purchaser in the latter stages has bought from a longer-term shareholder, who has in effect expressed a judgment on the company. This Government, previous Governments and this House have looked carefully at the rights of different classes of owners and have concluded that the hon. Gentleman’s suggestion would not be the right reform. However, he knows me well and I will of course consider the assessment of the conduct of this bid, but it would be wrong to mislead him by saying that I have formed a different view. I will take an objective view of the conduct of the bid, as will others in the House. The grounds for intervention  are specified in the Enterprise Act 2002, which reflects the requirements across the European Union that every member state must apply.

Bob Stewart: The old management was British, the new management is British, and the Secretary of State appears to have secured guarantees from the new management that it will do certain things that the old management had not guaranteed. Does that not imply that those who are working for the new GKN should sleep slightly more soundly in their beds?

Greg Clark: My hon. Friend puts it well and succinctly. Any takeover bid will obviously involve some anxiety for employees with long service, but whether or not the bid had succeeded, this was always going to be a period of change for GKN employees. As a result of the commitments that have been given, they can have more certainty about a confident future than would otherwise have been the case.

Darren Jones: In the Secretary of State’s previous statement on this issue I asked two questions: whether the Government would ask Melrose for a commitment to the aerospace division of longer than five years, based on advice both from key customers and other stakeholders; and whether the Government would have a conversation with Airbus about the consequences of a short-term commitment of five years? Will the Secretary of State confirm to the House whether he asked Melrose for a commitment of longer than five years and whether he had a conversation with Airbus? If not, why not?

Greg Clark: On the hon. Gentleman’s first point, the commitment to five years is the longest that has ever been given and was not something that Melrose was willing to offer the Business, Energy and Industrial Strategy Committee. In fact, the further undertakings that have been entered into on defence matters, which are of course in the aerospace division, go beyond that period.
I mentioned in reply to my hon. Friend the Member for Redditch (Rachel Maclean) that Airbus’s chief executive has not repeated the reports that were made previously. I have discussed the matter with Melrose and its intention is to develop a relationship that it hopes will prosper in the future.

Kevin Foster: Given that this is the first time that the process has been used, the Secretary of State has rightly focused on the legal undertakings that he has been able to extract from Melrose. Will he speak a bit more widely about the general discussions that he has had about the future role of GKN’s assets in his industrial strategy?

Greg Clark: I have been very clear in my discussions with both sides during the bid. It is important to have equal treatment when taking a quasi-judicial decision. GKN has an important role to play in our industrial strategy in two important sectors. GKN will be part of an aerospace sector round table later this week, and I expect it to live up both to its responsibilities and to the opportunities in this most exciting of sectors.

Paul Sweeney: Takeovers are a good thing where they are likely to enhance value, but it is clear that this highly leveraged takeover by Melrose is likely simply to load GKN with £8 billion of debt. We know what will happen, as we have learned the lessons of history: the company will be broken up and sold off piecemeal to recoup the debt raised by Melrose to create false value.
We have also seen a lukewarm commitment on R&D. GKN’s current R&D is at only half to two thirds that of its main competitors. Why did the Minister not seek a more ambitious undertaking that the takeover will enhance value and increase GKN’s R&D spending target to that of its main international competitors? I echo the sentiments of other Members on the need to amend our shareholder takeover rules to ensure that short-term interests of people with no industrial knowledge or understanding of companies are not permitted to distort the interest of stakeholders in the long-term value of this company.

Greg Clark: For the first time in British corporate history, we have secured a commitment to spend, as a minimum, what the incumbent is already spending on research and development—that should be welcomed. Obviously, the reports of accounts and the disclosures that will need to be made to the markets will shine a light on the debt, but it is striking that it has been suggested today that £150 million was accounted for by unpaid suppliers’ bills at the end of the last quarter—I gather that is in the filings that have been released today—so I imagine the hon. Gentleman will want to study very closely with a beady eye the reports of accounts as they are published in the months ahead.

Kelvin Hopkins: I am reminded of the Cadbury experience when it was taken over by Kraft. Undertakings were given about the factory in Bristol, which was sold off almost before the ink was dry on the deal. GKN is a company of national strategic importance not just to defence but to the wider economy and, indeed, to the Government’s much-vaunted industrial strategy. GKN should play a big part in that future.
If GKN were a German company in Germany or a French company in France this kind of speculative takeover would be prevented one way or another. One way to prevent it would be to have substantial stateholdings in such companies, and France, in particular, has done that over many years to make sure French companies remain French. Will the Government not look to France and Germany for the best way forward?

Greg Clark: Kraft’s takeover of Cadbury is exactly why we changed the rules so we can now have binding undertakings that are legally enforceable, unlike the situation that prevailed when the hon. Gentleman was in government. When it comes to the German system, in fact there is a substantial record of German companies being taken over.

Margot James: Vodafone.

Greg Clark: Yes, Vodafone’s takeover of Mannesmann is a classic case. KUKA, a German robotics company, has been taken over recently, as has Kabel Deutschland. There is a substantial record of takeovers in Germany. We have to operate the same public interest tests. What we have now is an ability to inquire into the intentions  for the medium and long term, and to obtain legally binding commitments on that. I hope the hon. Member for Luton North (Kelvin Hopkins) would welcome that, because many of his constituents will benefit from it.

John Bercow: I greatly enjoyed the Secretary of State’s answer to the hon. Member for Luton North (Kelvin Hopkins), and I hope he will not take offence if I say that the hon. Member for Luton North was not himself in government—he looked rather shocked, nay affronted, by any suggestion that at any time in his career he might have been. The hon. Member for Luton North is a career Back Bencher and is immensely proud of the fact.

Gavin Shuker: Workers at GKN’s Luton plant in my constituency are world leaders in ice protection systems for flight-deck windows and fast-jet canopies, and I believe they will share my dismay that the assurances the Secretary of State has put in place amount to little more than the new management picking up the phone and informing him before it does things that damage our national security and national interest. Is not the reality of the quasi-judicial nature of the decision-making process that he and future Secretaries of State will always veer on the side of caution, rather than face the prospect of being challenged in court when a takeover goes through?

Greg Clark: I am sure it is an unaccountable oversight that the hon. Member for Luton North (Kelvin Hopkins) has never served in government.
For the constituents of the hon. Member for Luton South (Mr Shuker), during the takeover bid, the incumbent management criticised the commitment to hold the aerospace division for five years. Given that a majority of the company was to be sold as part of the incumbent management’s plans, it is fair to observe that it is not clear there would be any greater stability—I put it as mildly as that—if the incumbent management had continued, rather than the new management that shareholders chose to manage the company.

POINTS OF ORDER

Rebecca Long-Bailey: rose—

Jack Dromey: rose—

John Bercow: I am saving up the hon. Member for Birmingham, Erdington (Jack Dromey). It would be a pity to squander him at too early a stage of our proceedings.

Rebecca Long-Bailey: On a point of order, Mr Speaker. The Secretary of State for Business, Energy and Industrial Strategy suggested in response to my earlier comments that I have never said what further undertakings he should have sought from Melrose. I know he cherishes our exchanges—there are many of them, so I forgive him for forgetting one of them—but on 27 March, in response to an update from him, I questioned the absence of numerous undertakings and was very specific about what they were. I would simply like to correct the record, and I accept his apology in advance.

John Bercow: I am most grateful to the hon. Lady for her attempted point of order, which I would prefer to classify as a point of continued debate. I am sure it will be of intense interest across the House, and copies of this particular extract of today’s proceedings will probably be lodged in the Library. More particularly, I rather imagine that she will wish speedily to communicate what she has just said to many, many thousands of people across Salford and Eccles.

Greg Clark: rose—

John Bercow: The Secretary of State has been prompted to come to the Dispatch Box. Who would dare deny him?

Greg Clark: Further to that point of order, Mr Speaker. I can only regret that I missed the extensive undertakings and the forensic examination by the hon. Member for Salford and Eccles (Rebecca Long Bailey). It is possibly down to the fact that she had prejudiced her consideration of this matter by saying that Labour would block the takeover, thereby making it completely impossible for her to have any role in it were she in my position as Secretary of State.

John Bercow: The shadow Secretary of State and the Secretary of State have now had their little bit of fun, in which, with my characteristic generosity, I have been willing at this early stage to indulge them. I do not think we need to pursue the matter any further for now. Doubtless, they will preserve these little titbits for their children, or possibly for subsequent generations.

Jack Dromey: On a point of order, Mr Speaker. Indulging in the use of uncharacteristic language, the Secretary of State for Business, Energy and Industrial Strategy suggested that no proposals had been put to him by me and others. Would he like to confirm that I and others met him and made representations to him in detail asking that the bid be called in under section 58 of the Enterprise Act 2002, with a particular focus on defence and strategic grounds? Would he therefore like to take the opportunity to correct the record?

John Bercow: It is an extraordinarily eccentric impersonation of a point of order not to seek any procedural ruling from me, although the hon. Gentleman is wise not to do so in respect of the contents of the Enterprise Act, but to deploy the ruse of a point of order to whizz past me at an aeronautical pace in pursuit of some debating reply from the Secretary of State. That is very disorderly behaviour, but as the mood of the House is, on the whole, quite an amicable one, let us hear the mellifluous tones of the Secretary of State, I hope for the last time today.

Greg Clark: I have high regard for the hon. Member for Birmingham, Erdington (Jack Dromey), and what he says is uncharacteristic of him. I am disappointed that the limit of his request is to block the bid, rather than to specify undertakings that could have been made and to engage in greater detail than simply saying, “No. Block it.” It would have been more fruitful on behalf of his constituents if he had delved a bit more into its substance, and I regret his not doing so.

John Bercow: I will sturdily resist any temptation to intervene further in that exchange. This private squabble may continue for a little while, albeit with good nature, I hope.

John Mann: rose—

John Bercow: On the subject of good-natured points of order, I say more in hope than in expectation, I call Mr John Mann.

John Mann: On a point of order, Mr Speaker. After a debate on anti-Semitism a week ago today, I have received very many kind remarks from parliamentarians, their staff and, indeed, members of House staff, for which me and my family are very grateful. There is an exception to that: one member of the Press Lobby chose to put out on social media, without any communication whatsoever with me, the suggestion that I had misled Parliament in relation a criminal act of violence against my wife. May I repeat, on the record, that I have not   misled Parliament and that my wife, who was the victim of this crime, has written to the media outlet concerned today clarifying this in some detail? This outrageous commentary has led to a wave of additional abuse against me, against my wife and against my daughter, including a threat of violence from a Labour party member from Sefton that is being referred to the police. Can you confirm my understanding that members of the Press Lobby have a privileged status within here? They have computers, telephones and lists of MPs, and if they are struggling to get hold of anybody they have the ability to wait outside this Chamber after a debate to speak to us. This member of the Press Lobby chose to use none of those things, and I just wanted your confirmation that the Press Lobby has the full ability to contact any of us, should they wish to do so, before putting out such scurrilous material.

John Bercow: I can confirm that. Any journalist can contact any Member if said journalist is minded to do so. I think it is as simple as that; I have no responsibility for what has been said, and the hon. Gentleman is not suggesting that I do. To be candid, I have no knowledge of which individual or outlet he has in mind. In a way, that is an advantage; he is asking me a straightforward question and I can offer him a straightforward confirmation by way of reply.
Needless to say, I am very sorry to hear about the torrent of abuse that the hon. Gentleman, his wife and his daughter have experienced—that is very sad. Nothing is going to stop the hon. Gentleman, whom I have known for more than 30 years, from speaking his mind, and it is right that that should be so. But it is a pity when people feel it necessary not to play the ball but to play the man or the woman, indulging in ad hominem abuse of a frequently loathsome kind, and sometimes of a kind that would be of interest to the police. This is a very worrying development in our democracy, about which I have spoken before, but I thank the hon. Gentleman for what he has said and I hope my reply offers him some reassurance.

UNSOLICITED CALLS (PREVENTION)

Motion for leave to bring in a Bill (Standing Order No. 23)

Stephen Kerr: I beg to move,
That leave be given to bring in a Bill to make provision to prevent unsolicited calls; and for connected purposes.
Lest anyone be in any doubt as to the seriousness and importance of this subject, I should inform the House that well over 100 Members kindly offered to co-sponsor such a Bill. This is the first time I have had the privilege of attempting to bring a Bill to the House and I am glad to be able to get this level of support from only a single email.
Receiving unsolicited telephone calls has become an infuriating but inevitable part of our daily lives. Such calls are intrusive, seldom of any use and, in many cases, made with the sole intention of ripping people off. The situation has become normalised and we should not be content with that. It is estimated that some 70 million nuisance calls are made every year; this is a growing problem. A Which? survey estimated that 39% of calls in September 2016 were a nuisance and that the volume of nuisance calls for some was astonishing, with 10% of people receiving more than 60 a month—that works out at two calls per day, on average. Later data shows that Scotland is the worst area in the UK for rogue calls. The most recent figures from Which? show that 71% of Scots believe that receiving cold calls has discouraged them from even picking up their home phone when it rings, with 41% saying they feel intimidated by cold calls. New BT figures claim that every household in the UK receives four nuisance calls a day; as this is across 23 million households in the UK, it would indicate the ridiculous figure of 5 billion nuisance calls a year. Needless to say, those numbers show the extent of a problem that is at least very large.
These calls are intrusive; as people are sitting down with their family enjoying a bit of downtime in front of the television, they get interrupted by a phone call that turns out to be an unwanted waste of time, inconvenient and annoying. In the residential setting, this kind of disruption is never welcome. For businesses, unsolicited calls play havoc with the rhythm of the daily business routine and with the productivity of offices. I heard of one business where if one nuisance call was received by one phone, it could almost be guaranteed that every phone in the office would receive the same call throughout the day. That is distracting for employees, taking up precious time for no productive purpose, and it blocks the line, preventing customers and suppliers from being able to get through on the phone.
I have also heard stories of helplines being clogged up with this kind of call, preventing people who genuinely need help from getting through. It is the equivalent of setting up a trader’s stall outside a hospital accident and emergency entrance that blocks ambulances from getting in. We would not allow this in the physical world, so why should we tolerate it in telephony? For many who are more vulnerable, the people at the end of the phone gather data and try to foist products and services on them, which are usually neither wanted, nor needed. This leads to people getting ripped off by often unethical operators. Laws are already in place against that, but  the line is blurry. Although people who phone purporting to be from a company to get access to someone’s computer are breaking the law, the calls where someone phones up to ask questions to build a profile of how vulnerable a person is may not be illegal.
This is a certainly an issue that affects millions of people across the country, one that demands action from us as legislators. We have a duty to ensure that our legislation is effective and gives the authorities the power they need to effect solutions to a huge problem. I am not suggesting for one moment that the Government have been complacent on this issue. Since the publication of the nuisance phone call strategy in 2014, there has been a great deal of Government action on this issue. I know how much work my right hon. Friend the Secretary for State for Digital, Culture, Media and Sport has undertaken on it, both in his current role and in his previous role as Minister of State. The single most significant element was placing responsibility for all nuisance calls with the Information Commissioner’s Office, creating a single port of call for the regulation of this issue. But more needs to be done, and making directors liable for the actions of their companies when they undertake nuisance calls is an essential part of the next step we should take in this House to tackle this problem. I hope to outline this element of what the Bill will do.
I recognise that much good work is being undertaken on financial services legislation that will outlaw the practice of soliciting insurance claims over the phone, making annoying traffic accident and payment protection insurance calls a thing of the past. Members will know that I am often a critic of the Scottish Government, but they have done much good work in this area. They have spent money on ensuring that people, especially the most vulnerable in our society, are aware of scams, and they have taken proactive steps to ensure that these warning messages get to the people who need to hear them. The Scottish Government estimate that the UK-wide economic harm from scam calls comes to £3 billion; this was in a report published only last month looking at the effectiveness of actions to reduce harm from nuisance calls. The work the Scottish Government have done has shown some results, and it is worth looking at this across the UK.
The private sector has also been hard at work on this issue. The Telephone Preference Service is a great way for people to limit their exposure to nuisance calls. BT has been working very hard to limit these calls. In my constituency, trueCall works with our local trading standards to install call blockers for vulnerable households and has blocked more than 21,000 scam and nuisance calls.
I would like to outline what I envisage the Bill doing. It is effectively divided into three parts, the first of which, as I have said, will make the penalties more robust and widen the way in which they can be applied. One aspect of the problem is that the companies that make nuisance calls are often pop-up companies. They are designed to make money and then go bankrupt, so that if they are caught, they will avoid a fine. That is an abuse of company law, and the Bill would make the directors of such companies personally liable for fines for nuisance calls. That reflects the private Member’s Bill that was introduced by the former member for Edinburgh West and the work of the hon. Member for  North Ayrshire and Arran (Patricia Gibson), to whom I pay tribute for her work on this issue. If directors are personally liable, people will think twice before authorising such activities.
The second part of this Bill will tighten up the definition of a nuisance call. We think we all know what a nuisance call is—it is when someone calls us up and tries to sell us something that we do not really want—but is that, in fact, the definition that we should adhere to? Sometimes we receive calls that we are not expecting from businesses, and they are good. Is it right to say that a nuisance call is simply a call that we do not want? That would effectively end the opinion poll business and all telephone canvassing, and I am not sure whether that would make the Bill more desirable to Members or less. It is clear that the current legal definition is not effective, and the Bill is designed to empower the Government and the regulator to have a more robust definition of nuisance calls.
Finally, I would like to place a general responsibility on unsolicited callers to ensure that the numbers they are dialling are not registered with the Telephone Preference Service. That would ensure that there was no problem when phone numbers were bought and sold. As with any valuable data commodities, it would be the responsibility of both the purchaser and the seller to establish whether a number was a TPS number. It would be possible to fine both parties if they had not performed due diligence on the nature of the numbers that had been traded.
This is an important issue, which has rightly gained a lot of attention from across the House. It has also elicited a lot of conversation with the private sector. I thank Brendan Dick and his team at BT Scotland for providing me with an excellent briefing, as well as Which? and Citizens Advice for the work that they have done in this area. If we can make the situation better for people, we will remove a nuisance and make everyone’s lives a bit easier. At the same time, we will improve business productivity. It is seldom that one finds such widespread agreement on any issue across the House, and therefore I commend the Bill to the House.
Question put and agreed to.
Ordered,
That Stephen Kerr, Kate Hoey, Hugh Gaffney, Rachel Reeves, Mr Alistair Carmichael, Ben Lake, Nigel Dodds, Lady Hermon, Dame Cheryl Gillan, Fiona Bruce and Patricia Gibson present the Bill.
Stephen Kerr accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 6 July, and to be printed (Bill 197).

FINANCIAL GUIDANCE AND CLAIMS BILL [LORDS]

[Relevant document: Third report of the Work and Pensions Committee, Protecting pensions against scams: priorities for the Financial Guidance and Claims Bill, HC 404.]
Consideration of Bill, as amended in the Public Bill Committee
New Clause 4

Unsolicited direct marketing: other consumer financial products etc

“(1) The Secretary of State must keep under review whether a prohibition on unsolicited direct marketing in relation to consumer financial products and services other than pensions would be appropriate.
(2) If the Secretary of State considers that such a prohibition would be appropriate, the Secretary of State may make regulations applying regulations made under section (Unsolicited direct marketing: pensions) to other consumer financial products and services (with or without modifications).
(3) In considering whether to make such regulations, the Secretary of State must take into account any advice received from the single financial guidance body under section 3(7)(b)(ii) (consumer protection function: advice on effect on consumers of unsolicited direct marketing).
(4) The regulations may—
(a) make different provision for different purposes;
(b) make different provision for different areas;
(c) make incidental, supplementary, consequential, transitional or saving provision.
(5) Regulations under this section are to be made by statutory instrument.
(6) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”—(John Glen.)
This new clause would give the Secretary of State the power to make regulations (subject to the affirmative procedure) banning unsolicited direct marketing in relation to consumer financial products and services other than pensions. It would come immediately after NC3
Brought up, and read the First time.

John Glen: I beg to move, That the clause be read a Second time.

Rosie Winterton: With this it will be convenient to discuss the following:
Government new clause 9—Unsolicited direct marketing: pensions (No. 2)—
‘(1) The Secretary of State may make regulations prohibiting unsolicited direct marketing relating to pensions.
(2) The regulations may—
(a) make provision about when a communication is to be, or is not to be, treated as unsolicited;
(b) make provision for exceptions to the prohibition;
(c) confer functions on the Information Commissioner and on OFCOM (including conferring a discretion);
(d) apply (with or without modifications) provisions of the data protection legislation or the Privacy and Electronic Communications (EC Directive) Regulations 2003 (S.I. 2003/2426) (including, in particular, provisions relating to enforcement).
(3) The regulations may—
(a) make different provision for different purposes;
(b) make different provision for different areas;
(c) make incidental, supplementary, consequential, transitional or saving provision.
(4) Regulations under this section are to be made by statutory instrument.
(5) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.
(6) If before the end of June in any year the Secretary of State has not made regulations under this section (whether or not in that year), the Secretary of State must—
(a) publish a statement, by the end of July in that year, explaining why regulations have not been made and setting a timetable for making the regulations, and
(b) lay the statement before each House of Parliament.
(7) In this section, “OFCOM” means the Office of Communications established by section 1 of the Office of Communications Act 2002.”
This new clause inserts a new power for the Secretary of State to make regulations (subject to the affirmative procedure) banning unsolicited direct marketing relating to pensions. If the power is not exercised by June, the Secretary of State must explain to Parliament why not. This new clause would be inserted after Clause 24.
Amendment (a) to new clause 9,in subsection (1), leave out “may” and insert “must”.
Amendment (b) to new clause 9,in subsection (1), after “pensions” insert
“and prohibiting the use for commercial purposes of information obtained by means of such direct marketing”.
Amendment (c) to new clause 9,in subsection (2)(c), leave out “and on OFCOM” and insert
“, on Ofcom and on the Financial Conduct Authority”.
Amendment (d) to new clause 9,in subsection (2)(d), after “(S.I. 2003/2426)” insert
“or the Financial Services and Markets Act 2000”.
New clause 1—High-cost credit: advice to the Financial Conduct Authority—
“(1) In exercising its functions the single financial guidance body must have regard to the effect of high-cost credit card lending on consumer protection and must produce and publish an annual assessment of any consumer detriment.
(2) The assessment under subsection (1) shall in particular consider—
(a) what level of interest and fees constitute a high-cost credit card;
(b) information provided by high-cost credit card providers to customers, and whether such information allows customers to make informed financial decisions;
(c) the impact of high-cost credit lending on levels of personal debt,
as well as any other factors that the single financial guidance body considers relevant.
(3) If the single financial guidance body considers it to be necessary for consumer protection it must advise the Financial Conduct Authority to impose a limit on the cost of specified types of credit.”
This new clause would require the single financial guidance body to consider the effect of high-cost lending using credit cards on consumer protection and produce an annual assessment of any consumer detriment from such high-cost lending.
New clause 2—Specific requirements as to the pensions guidance function: mid life reviews—
“(1) As part of its pensions guidance and money guidance functions, the single financial guidance body must provide targeted information and guidance for members of the public from the age of 50 to help them make decisions on their financial affairs.
(2) In particular, the information and guidance in subsection (1) shall include information and guidance on—
(a) increasing pension contributions in preparation for retirement,
(b) saving money in preparation for retirement, and
(c) career development and the impact of career development on financial matters including preparation for retirement.”
This new clause provides for the single financial guidance body to provide guidance to members of the public over the age of 50, to prepare them for retirement. These “mid life reviews” would provide guidance on pensions, savings, and career development.
New clause 6—Regulatory principles to be applied in respect of claims management services—
“(1) The FCA may make recommendations to the Secretary of State on regulatory principles to be applied to claims management services.
(2) The matters on which the FCA may make recommendations include, in relation to claims management services—
(a) the duties of authorised persons to act honestly, fairly and professionally in accordance with the best interests of consumers;
(b) the duties of authorised persons to manage conflicts of interest fairly, both between themselves and their clients, and between clients;
(c) other duties of authorised persons related to a duty of care towards their clients.
(3) If the FCA recommends that regulatory principles be applied to claims management services, the Secretary of State may by regulations impose such principles.
(4) The power to make regulations under subsection (3) is exercisable by statutory instrument; and an instrument containing such regulations is subject to annulment in pursuance of a resolution of either House of Parliament.
(5) In this section, ‘authorised person’ has the same meaning as in the Financial Services and Markets Act 2000, and ‘authorised persons’ shall be construed accordingly.”
This new clause would allow the FCA to recommend that the Secretary of State introduces a duty of care which would require claims management services to act with the best interests of the customers in mind.
New clause 7—Assessment of public preparedness for income shocks—
“(1) As part of its strategic function, the single financial guidance body must from time to time publish an assessment of the ability of members of the public to plan for and address sudden reductions in income.
(2) An assessment under this section must consider the impact of the work of the single financial guidance body on the ability of members of the public to plan for and address sudden reductions in income.
(3) The Secretary of State must lay before the House of Commons any assessment conducted under this section as soon as practicable after its completion.”
New clause 8—Ban on unsolicited real-time direct approaches by, on behalf of, or for the benefit of companies carrying out claims management services and a ban on the use by claims management companies of data obtained by such methods—
“(1) The FCA must, as soon as they take responsibility for claim management companies, introduce bans on—
(a) unsolicited real-time direct approaches to members of the public carried out by whatever means, digital or otherwise, by, on behalf of, or for the benefit of companies carrying out claims management services or their agents or representatives, and
(a) the use for any purpose of any data by companies carrying out claims management services, their agents or representatives where they cannot demonstrate to the satisfaction of the FCA that this data does not  arise from any unsolicited real-time direct approach to members of the public carried out by whatever means, digital or otherwise.
(2) The FCA must fix the appropriate penalties for breaches of subsection (1)(a) and (b) above.”
Amendment 31,in clause 2, page2,line17, at end insert—
“including information about the services offered by credit unions,”
This amendment adds to the objectives of the single financial guidance body the requirement to provide information about credit unions.
Amendment 39,page2,line23, leave out from “accordingly” to the end of line 24 and insert—
“(da) to ensure the needs of people in vulnerable circumstances, including but not exclusively—
(i) those who suffer long-term sickness or disability,
(ii) carers,
(iii) those on low incomes, and
(iv) recipients of benefits,
are met and that resources are allocated in such a way as to allow specially trained advisers and guidance to be made available to them,”
This amendment would require that specially trained advisers and guidance are made available to people in vulnerable circumstances and would provide an indicative list of what vulnerable circumstances should include.
Amendment 40,page2,line36, at end insert—
“(4) The single financial guidance body must ensure it communicates to consumers using its services the difference between—
(a) provision of information,
(b) provision of guidance,
(c) provision of advice.”
This amendment would require the new body to ensure that consumers are made aware of the differences between ‘information’, ‘guidance’ and ‘advice’ so that they can specify what type of services they require from the new body.
Amendment 4,page3,line5, in clause 3, at end insert—
“(c) advice to the Financial Conduct Authority on matters relating to high-cost credit”.
Amendment 41,page3,line16, at end insert—
“(6A) As part of its money guidance function, the single financial guidance body must make available financial guidance on the use of alternative sources of retirement income, including housing wealth, to enable members of the public to make fully informed decisions about pensions and retirement income.”
This amendment would place a duty on the single financial guidance body to make available guidance on alternative sources of retirement income, such as equity release. This will provide a pathway for members of the public to consider their wider assets, particularly their housing wealth, to make effective decisions about their retirement income.
Government amendment 10,page3,line17, leave out subsection (7) and insert—
‘(7) The consumer protection function is—
(a) to notify the FCA where, in the exercise of its other functions, the single financial guidance body becomes aware of practices carried out by FCA- regulated persons (within the meaning of section 139A of the Financial Services and Markets Act 2000) which it considers to be detrimental to consumers, and
(b) to consider the effect of unsolicited direct marketing on consumers of financial products and services, and, in particular—
(i) from time to time publish an assessment of whether unsolicited direct marketing is, or may be, having a detrimental effect on consumers, and
(ii) advise the Secretary of State whether to make regulations under section (Unsolicited direct marketing: other consumer financial products etc) (unsolicited direct marketing: other consumer financial products etc).”
This amendment makes changes to the consumer protection function to make it clearer exactly what it entails.
Amendment (a) to amendment 10, in paragraph (b)(i), leave out “from time to time” and insert
“at least once every two years”.
Amendment 34,page3,line34, at end insert—
“(aa) the capability of members of the public to plan for and address sudden reductions in income,”.
Amendment 1,page3,line39, at end insert—
“(11) In carrying out its strategic and other functions the single financial guidance body must make and publish an annual assessment of the level of different types of lending across the United Kingdom by district.
(12) The types of lending covered by the assessment in subsection (11) should include—
(a) high cost short term credit,
(b) hire purchase agreements,
(c) conditional sale agreements,
(d) open ended credit,
(e) other secured lending, and
(f) other unsecured lending.”
This amendment requires the single financial guidance body to carry out an annual assessment of the level of different types of lending in different geographical areas across the United Kingdom.
Government amendment 11.
Amendment 8,in clause 4, page4,line2, at end insert—
“(2A) The single financial guidance body must, within 12 months of the passing of this Act, advise the Secretary of State on how to most effectively implement bans on—
(a) cold-calling on behalf of, or for the benefit of companies carrying out claims management services or their agents or representatives, and
(b) the commercial use of any data by companies carrying out claims management services, their agents or representatives where they cannot demonstrate to the satisfaction of the Secretary of State that this data was not obtained by cold-calling.
(2B) In this section ‘claims management services’ has the same meaning as in section 419A of the Financial Services and Markets Act 2000.”
This amendment will require the Secretary of State to specifically ban cold-calling and the commercial use of data from cold-calling by claims management companies, in addition to any bans recommended by the single financial guidance body.
Amendment 9,page4,line4, leave out “may” and insert “must”.
This amendment will place a statutory duty on the Secretary of State to institute bans on cold-calling on receipt of advice to do so from the single financial guidance body.
Amendment 42,in clause 10, page7,line22, at end insert
“and to whether the standards are proportionate”.
Probing amendment. The SFGB’s standards setting powers also need to be matched with principles of good regulation, ensuring that conditions are proportionate to the benefits they are expected to bring. This would bring the Bill (impacting charities) into line standards setting and enforcement powers granted to other bodies (impacting firms) such as those granted to the FCA.
Government amendments 12, 43, 25, 44, 26 45 and 46.
Amendment 2,in schedule 3, page45,line8, at end insert—
17A (1) Section 165 (regulators’ power to require information: authorised persons etc) is amended as follows.
(2) In subsection (4) after paragraph (b) insert—
(c) in relation to the exercise by the FCA of the powers conferred by subsections (1) and (3), information and documents reasonably required by the single financial guidance body in connection with the exercise by the body of its functions as set out in section 3 of the Financial Guidance and Claims Act 2018.”
This amendment extends the FCA’s power to require information from authorised persons to include information required by the single financial guidance body for carrying out its functions.
Government amendments 47, 48, 28 and 29.

John Glen: It is a great pleasure finally—for the third time of asking, I believe—to have the opportunity to the start the Bill’s Report stage. I want to make a positive start to proceedings by covering new clauses 4 and 9, which will allow us to protect consumers from harmful cold calls by enabling us to lay before the House regulations to ban pensions cold calling and introduce bans for other forms of cold calling, if we consider it appropriate to do so.
As I have said previously, I want to ban pensions cold calling as soon as possible, given the profoundly damaging impact that pension scams can have on people’s lives. I have listened to the recommendations of the Work and Pensions Committee, which published a report before the turn of the year on preventing pension scams, as well as to the passionate calls that have been made across the House and in the other place to ban pensions cold calling. I am pleased to present new clause 9, which builds on and improves the clause proposed by the Committee. The Government’s new clause has a wide scope, which means that we can ban all pensions-related calls. Crucially, we do not need to wait for advice from the guidance body before we implement a ban, so we can make good on our commitment to ban pensions cold calling quickly. I hope that the fact that I will have to lay a statement before both Houses if we have not laid regulations before Parliament by June will reassure hon. Members on that point.
I turn to new clause 4. It is clear to me that, too often, significant consumer detriment arises because of cold calling. If we find evidence that people are experiencing detriment as a result of cold calling regarding consumer financial products, we will not hesitate to use this power to protect consumers.
I am pleased to be able to confirm the final part of our approach to protect consumers from cold calling by means of amendment 10. The amendment expands and improves on the consumer protection function. It gives the body powers to publish regular assessments of consumer detriment resulting from cold calling, and to advise the Secretary of State on where further bans should be implemented. The change clarifies the consumer protection function and gives the body a clear mandate to support the Government in preventing harm that results from cold calling. In fact, the Bill has been agenda-setting in relation to cold calling. The amendments  that we are discussing will give the Government new powers to ban cold calling in some the areas that are the most pressing when it comes to protecting consumers.

Neil Gray: I thank the Minister for giving way and commend him for the action that he has taken—I am very supportive of it. He has made a good case for banning cold calling in the pensions industry and some other financial industries. The clear case for doing so has been well made, but why will the Government not go further and ban cold calling outright?

John Glen: I have tried to make clear that when we are setting up a new body, it is important that we take time to reflect on the evidence and that we take action in consultation with and alongside that body. I acknowledge the widespread concern that exists in other areas, and I think that the action we are taking gets the balance right when it comes to getting the evidence together and moving as quickly as possible when the case has been made.
The amendments that I have outlined are additional to the amendment that was made in Committee to introduce a ban on claims management cold calling, which will cover calls about claims on matters ranging from mis-sold payment protection insurance to holiday sickness and car accidents. That means that calls about PPI, whether we have been in a car accident or whether we were sick on holiday—we are all familiar with such calls—will be banned unless prior consent has been given to receiving them.
Having ensured that we can tackle cold calling effectively, we plan to remove the existing clause 4 by means of amendment 11. Amendments 12, 25, 26, 28, 29, 45 and 46 are minor and consequential to these changes. In particular, amendment 45 commences new clause 9 on Royal Assent to ensure that there is no unnecessary delay in making regulations, and amendments 44, 47 and 48 prepare the Bill for the new data protection legislation.

Jack Dromey: I wish to address the issues of pensions cold calling in new clause 9, wider cold calling in amendments 8 and 9, and the duty of care in new clause 6.
Let me start by saying what this Bill is about. In Committee, we heard the story of the Port Talbot shift supervisor who broke down and wept uncontrollably when he met the Pensions Advisory Service. He described how he had been conned into going down the wrong path on his pension, losing tens of thousands of pounds as a consequence. The reason why he wept, he said, was that all 20 on his shift followed his lead, and therefore they, like him, now faced a much bleaker future than would otherwise have been the case.
Pension cold calling is a blight on people up and down the UK. As the Minister has said, we all know the feeling of answering the phone to a number that we do not recognise and hearing that familiar phrase, “We believe that you have been in a car accident.” Indeed, I was heading over to one of the Bill Committee sittings when I received such a call, not having had one for some years. Someone said that they understood that I had been in a car accident. I said that, yes, I had been in an accident 38 years ago, and it was because somebody had  run into the back of me. Since then, I have had two subsequent annoying cold calls, yet mine is but a minor problem. The more significant one is the 11 million pensioners who are targeted annually by cold callers. Fraudsters are making 250 million calls a year, which is equivalent to eight every second.
As the Minister knows, we have approached the cold-calling element of this Bill on a four-pronged basis: first, banning pensions cold calling; secondly, pushing for a total ban now on cold calling for claims management companies, thereby tackling the scourge of unsolicited claims head on; thirdly, banning the use of information obtained through cold calling; and, fourthly, ensuring that the strongest possible sanctions are put on those who break the ban, which means that they are struck off.
The Government’s commitment to ban pensions cold calling from June is a necessary and wholly welcome step. May I make the point—such points are not often made in the House—that the Under-Secretary of State for Work and Pensions, the hon. Member for Hexham (Guy Opperman), and the Economic Secretary to the Treasury have engaged with us, the wider community and the pensions industry? Their approach has been constructive. Together, we have come a very long way, but I hope that they will go just that little bit further. Our amendments would tighten the provisions around the ban and ensure that it is fit for purpose. The dual additions of making it an offence to use the information obtained through cold calling and conferring functions on to the Financial Conduct Authority would mean that the ban could be much tighter and more effective.
Although the original clause means that the “introducers” who tend to commit a lot of cold calling in cases such as the British Steel scandal would not be restricted, as they are not covered by the FCA, our amendment would restrict them. The move to ban the use of the information means that those firms which provide financial services and are covered by the FCA will be banned from using the information that the “introducers” gather. This slight shifting of the ban is designed to strengthen it further, as the FCA has much stronger powers than the Information Commissioner’s Office and can strike off members who contravene the rules. We therefore hope that Ministers will reflect further on this.
I now move on to cold calling more widely. A crucial issue on which the Minister has touched is the speed with which we now act. Cold calling has a negative impact for not only pensions, as many other industries that have been blighted by cold calling that creates serious consequences for innocent consumers. It is common for claims management companies to try to harvest cases for road traffic accidents and holiday sickness. Unfortunately, and extraordinarily, the UK has become the world leader for holiday sickness claims. The Association of British Travel Agents said that there were about 35,000 claims of holiday sickness in 2016, which represents a 500% rise since 2013. One in five Britons—19%, or around 9.5million people—has been approached about making a compensation claim for holiday sickness. Statistics from just one tour operator, in July and August, show that there were 750,000 travelling British customers, 800,000 Germans and 375,000 Scandinavians. The Scandinavians lodged 39 claims for holiday sickness and the Germans filed 114. The Brits put in just under 4,000 claims.
Data from Jet2 Holidays shows that the longest delay involving a holiday sickness claim was a striking 11 months from the date of alleged illness, while the shortest delay was two months. That equates to an average delay of 5.8 months. Furthermore, 50% of claims were brought more than three months after the person’s return from holiday. As a result, hoteliers in the markets affected are threatening significant price increases.
A total ban on cold calling would be likely to lead to a fall in the harvesting of false holiday sickness claims. Two recent cases that were taken to court show that the practice is not only improper and immoral, but unlawful, with one particular couple from Merseyside receiving a prison sentence. Deborah Briton was sentenced to nine months and her partner Paul Roberts for 15 months, not least because they had advertised what a good holiday they were having only then to be encouraged by a claims management company to submit a false claim when they got back home.

Alex Sobel: My hon. Friend referred to Jet2, which is headquartered in my constituency and has raised this issue with me on many occasions. It says that these vexatious claims are increasing the cost of flights and holidays for the rest of us. Is it not true that closing this loophole will effectively mean that we can all enjoy a holiday at a much more reasonable price?

Jack Dromey: My hon. Friend is absolutely right. When a reputable company such as Jet2 makes the point that the consequence of this practice might be price increases and a reluctance among some hoteliers to enter into agreements, it is clear that innocent holidaymakers will pay the price.
It is not just travel companies that are suffering due to the large number of cold calls. Around 51 million personal injury-related calls and texts are sent by regulated claims management companies each year. The Association of Personal Injury Lawyers has long called for a ban on personal injury cold calls from CMCs, especially as solicitors themselves are already banned from cold calling. Ironically, only recently, the Justice Secretary said that there would be a “forthcoming ban on cold calling” when discussing personal injury claims. If the Justice Secretary believes that there is a forthcoming ban, why do we not act now and include it in this Bill? As Lord Sharkey said in the other place, the ban is necessary to deal with the “omnipresent” menace of cold calls. Baroness Altmann has said:
“People need protection from this nuisance now. They shouldn’t have to wait still more years for a ban....Direct approaches to people on their mobiles or home phones should have no place in the modern world of business.”
The Government, in the public interest, must accept the amendment to ban cold calls when this Bill passes.

Ruth George: My hon. Friend makes an excellent argument for banning such cold calls. Does he agree that the banning of cold calling by claims management companies for personal injury claims would be a far more effective method of reducing costs for insurance and personal injury than the Government’s proposals, which are currently being considered in the other place, to limit the injury compensation due to innocent victims, as well as to those who are not innocent?

Jack Dromey: My hon. Friend is absolutely right. There are legal consequences for those who make unlawful claims, but there are also business consequences, which in this case knock on to the legal profession and its work. Looking at it from every angle, this is a menace that we need to bring to an end; the question is how soon we can do so.
We hope that the Government will accept our proposals, not least because the Conservative party said at the 2017 general election that it would
“consider a ban on companies cold calling people”.
This is the Government’s chance to keep at least that manifesto promise while protecting the public at the same time.
It is deeply welcome that the Government have taken the powers to ban cold calling for pensions. They have also indicated their support—indeed, the Minister did so earlier—for a wider ban, which our amendment calls for. We are not calling for a blanket ban, which the Minister believes could impinge on non-contentious issues such as doctor-patient calls. The situation is different when such an established relationship exists. We are talking about commercial companies that are pursuing a commercial advantage. All claims management companies should be banned from cold calling, so we urge the Government to set out in the Bill that they will stop the scourge of cold calls by claims management companies.
New clause 6—this is the only other provision to which I will speak—would introduce a duty of care by requiring claims management services to act in the best interests of customers, not least those who find themselves in a vulnerable situation. Due to the scope of the Bill, the new clause relates only to claims management services. However, although this change would be important, we believe that a duty of care is required across all financial service providers. Many consumers are forced to deal with financial providers when they are at their most vulnerable. Such people can include those who have been diagnosed with serious illnesses, including cancer. At present, the Financial Services and Markets Act 2000 requires that the FCA must have regard to
“the general principle that consumers should take responsibility for their decisions”.
Frankly, that is not good enough.
The Financial Services Consumer Panel told the Lords Financial Exclusion Committee that consumers could reasonably be expected to take responsibility for their decisions only if firms had exercised a duty of care towards them. It suggested that such a duty would oblige financial services providers to avoid conflicts of interest and act in the best interests of their customers. The panel proposed amending the law to require the FCA to make rules on a duty of care, arguing that the introduction of such a duty would lead to a much-needed cultural change in the banking sector and the financial sector more generally.
Let us look at just one example. The charity Macmillan Cancer Support has said that people affected by cancer tell it that they experience barriers to getting the support that they need from the banking sector. By 2020, one in two people will have cancer at some point in their lives. Four in five people with cancer are £570 a month worse off on average as a result of their diagnosis. For example, Christine was first diagnosed with cancer in 2009, but is still feeling the financial effects today. She said:
“The financial fall-out of cancer was huge—I went into my overdraft and had to take out a loan to pay it off. When I found out that my credit rating had suffered, it seemed unfair because I was trying my best to get back into work and to have money coming in…For people like me who want to go on living and working, it’s about having that short-term support and understanding. What would have been great was if I’d been able to have an honest conversation with my bank”.
A specific requirement therefore needs to be explicitly stated to ensure that all financial institutions do their best by the most vulnerable people in society. The strong evidence that has been presented by Macmillan clearly shows that a universal duty of care is required across financial services providers.
In the light of examples in which the principle of treating customers fairly is clearly failing customers, how has the FCA reassured Ministers that the current regulatory provisions are sufficient? Can the Minister provide further details on when the discussion paper to which he referred will be brought forward? I know that he is seized of the problem and wants progress to be made at the next stages. That is crucial and, once again, we want to get on with it, because we need to tackle the real problem that has been identified. What assurances can the Minister give that action will be taken to ensure the timely introduction of the duty of care following the outcome of the FCA’s consultation paper?
We strongly support amendments tabled by a number of hon. Members, led by my hon. Friend the Member for Harrow West (Gareth Thomas), that would ensure that banks and financial institutions take proper account of local and regional need, and do not let down local people, as is all too often the case now.

Crispin Blunt: I will speak to amendment 41, which is in my name. My amendment is intended to make a point to the Minister, and I am utterly certain that I will get the assurance that I need in order to do nothing more than discuss it now.
I welcome the introduction of a single financial guidance body, as it should result in a simpler, smarter and smoother experience for the user, helping them to make informed financial decisions. However, we ought to use the opportunity of this Bill not only to ensure that we get the guidance bodies all in one place; we also need to recognise the different types of finance or retirement income that need to be signposted. Financial decision making can be complex, often requiring advice and support, particularly during events such as buying a first home, on retirement or following a bereavement.
I tabled this amendment because people ought to consider their finances in the round. In other words, all liquid and illiquid assets—cash and property—should be considered together. My amendment follows the lead of the noble Lady Greengross in the other place, asking the Government to ensure that this new guidance body highlights the full range of options available, so that its users get the best possible advice to help them to make informed choices about their finances and their futures.
The report published last month by the Housing, Communities and Local Government Committee describes equity release as one of the key tools available to those predominantly in later life. It ensures that older householders are able to pay for care costs or home improvements to give them the option to stay in the homes in which they have built lives and brought up their families. Equity release  means that our constituents aged 55 and over who might be asset rich but cash poor can have the option of staying in their own homes by accessing the wealth that they have accrued in that home.
The Equity Release Council published a research paper last April called “Equity Release Rebooted”, in which it estimated that the average value of a defined contribution pension in 2012 to 2014 was £30,200, while over-55s in England possess approximately £1.8 trillion in housing wealth and more than 80% of over-65s own a home. For many, if not most people coming towards the position of making a decision about their retirement, their property is much their greatest asset. It must therefore be sensible for equity release to be signposted and to form at least part of any discussion about funding retirement and later life.

Alex Cunningham: I agree with what the hon. Gentleman is saying. Does he not think, therefore, that there is considerable merit in new clause 2, which promotes the idea of specific guidance for people in mid-life so that they get proper and clear advice on some of the decisions that they may have to make?

Crispin Blunt: I am sure that there is enormous merit in new clause 2, and I hope that the hon. Gentleman has the opportunity to make the case further. There is obviously a common theme of making sure that people have the information about all their assets to enable them to make the best possible decision. We must make sure, in setting up the body in this Bill, that we do not have to come back to this later on because, in practice, we are not delivering the best advice to people about all the assets with which they have to plan.
The pensions advice allowance allows people to withdraw £500, tax-free, from their pension pots to pay for financial advice on their retirement, including on housing wealth, but some people will be unwilling or unable to use this facility. It is incumbent on the single financial guidance body to provide free, impartial guidance and to ensure that this encompasses housing wealth. It is likely that any signposting requirement would push consumers towards the Equity Release Council, the industry body for the equity release sector. Members of the Equity Release Council are committed to product standards and consumer safeguards.

Stephen Lloyd: The hon. Gentleman is making a salient point. Given that the range of interest rates for a number of companies that offer equity release is really quite considerable, does he agree that one of the advantages of the advice going through an independent body is that those who are offering better and lower interest rates for consumers are more likely to receive custom?

Crispin Blunt: I am grateful to the hon. Gentleman, and I agree. He will note the very distinguished role that his predecessor played in the whole business of promoting equity release. It ought to be a really major option given the construction of people’s resources and where they sit on the scale of property ownership in the UK. We need to be clear about how important an asset it is and how important it is to make sure that this industry has the opportunity to give the best possible service to people in their life plans.
Consumers must obtain qualified financial and independent legal advice before they confirm their decision to go ahead and purchase any equity release product. Guarantees include the right to remain in the property for life or until moving into long-term care. Another key safeguard provided by members of the Equity Release Council is the “no negative equity” guarantee, whereby the repayment of the loan is never greater than the value of the home.
A major reason why the single financial guidance body signpost should include housing wealth is the growth in the equity release sector. Homeowners released £3 billion worth of equity in 2017, with 37,000 new customers signing up for equity release products for the first time.

Mark Tami: The hon. Gentleman keeps saying that this is about releasing equity. What people are actually doing is borrowing against the perceived wealth of the property.

Crispin Blunt: They are not borrowing against the perceived wealth of the property—it is the actual wealth of the property. If someone is in a position of planning for their retirement and they do not have an adequate pension pot, and given the scale of the imbalance between people’s assets in property as opposed to the pension provision they have made, it is obvious that, in making the assessments for their retirement, they should consider accessing the wealth they have accrued that is in their home.
With 37,000 customers signing up for equity release products for the first time in 2017, the number of these products has also risen enormously over the last decade—by 225%—and 78 product options with the necessary range of flexibilities are now available. This can only improve and grow as the industry develops. Consumers utilise equity release for various reasons, such as paying off a mortgage, making adaptations to the home, boosting retirement income, or as a means of providing deposits to children and grandchildren to enable them to take their first step on the housing ladder. Equity release can help in meeting some of the challenges in social care and in housing.
We should be more ambitious, ensuring that the new body signposts solutions such as equity release to all those we represent who might really benefit from unlocking the main source of their wealth overall, which will be the equity in their home. I look forward to hearing from the Minister how we are going to make a reality of that in practice through the guidance.

Neil Gray: I rise to speak to amendments 39 and 40, which are in my name. I want to say at the outset that while Scottish National party Members have felt the need to bring back some elements from Committee, we do on the whole welcome and support the Bill. We just want to see some improvements, which we hope will help to protect consumers and those accessing financial products. It is a shame that on the third attempt to consider the Bill we may still not get time to consider the second group of amendments, and in particular those tabled by the right hon. Member for Birkenhead (Frank Field), which we are keen to consider. However, I will proceed as quickly as possible so that we might get to the second group in good time.
First, amendment 39 would require that specially trained advisers and guidance are made available to people in vulnerable circumstances and would provide an indicative list of what “vulnerable circumstances” should include. It is positive that the Government decided to amend the Bill in the House of Lords to include a reference to the needs of vulnerable people within the functions of the new single financial guidance body. However, we feel that the Government should go further.
The amended version of the clause remains a little weak with regard to the inclusion of vulnerable people. Our amendment would make things more explicit and strengthen that objective by providing more detail as to who may fall into this remit, using the term “people in vulnerable circumstances”, which we think is more appropriate. The circumstances illustrated in our amendment can have a significant impact on people’s finances and long-term savings plans.
People in difficult financial circumstances may be more likely to use new pension freedoms, at a cost to their long-term pensions saving. Attractive as the pension freedoms may sound, it is clear that the Government have not put in place adequate safeguards for older people who are opting to free up funds, to ensure they will not end up in a desperate financial situation later. Those with less money are more vulnerable to economic shocks in their personal circumstances, as well as being potentially more vulnerable to scammers who give misleading or false advice for a fee, as we heard from the shadow Minister, the hon. Member for Birmingham, Erdington (Jack Dromey).
Being a carer or disabled can incur extra lifestyle costs. We want to ensure that the new body is as accessible as possible for all people, regardless of their circumstances. Specially trained advisers and resources must make up part of the new body, so that people can have confidence in its ability to support people in vulnerable circumstances.
The Minister said in Committee that our amendment was too prescriptive, but that does not really stand up. There is plenty in the Bill that is prescriptive and detailed. The new financial guidance body will be looking to the content of the Bill to understand what its objective and remit are. We are simply ensuring that the new body is absolutely clear that catering for those who find themselves in vulnerable circumstances should be a significant part of its remit. The wording of clause 2 makes that sound like an afterthought. That is an important discussion to be had alongside the duty of care, which I will come to later.
Amendment 40 would require the new body to ensure that consumers are made aware of the differences between information, guidance and advice, so that they can specify what type of services they require from it. In Committee, my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) tabled an amendment that would require the new financial guidance body to define the meaning of those services. The Minister said that that would potentially duplicate available definitions set out in regulations, but he also seemed to think that we asked for a definition because it would be useful for the body itself. That was not our purpose. Our purpose was to ensure that consumers themselves understand what services they have access to. We are tabling this amendment with tweaked wording to make  it clear that we are asking that the new financial guidance body communicates clearly what services it provides people with and what they can access.
Guidance, information and advice are very different things. People expecting advice on what route to take may be disappointed to receive various information only. Likewise, there may be issues around exactly what the body is allowed to advise and to what extent it is able to advise on options available. Through this amendment, we are simply highlighting how important it is to ensure that users understand what they are getting.
Government new clauses 4 and 9 give the Secretary of State power to ban cold calling related to pensions and other consumer financial products. The Government have also tabled amendments to bring forward commencement of those clauses. The SNP and the Scottish Government have campaigned hard on cold calling, so we are pleased to see those provisions in the Bill. It is a positive step that the Government have tabled amendments 45 and 46, which will speed up the process for putting in place the necessary regulations for banning cold calling. It is clear that consumers want action now.
On the Government’s amendments, there is a concern that the Government are treating claims management companies’ cold calling and pensions or financial products cold calling differently. In Committee, the Government introduced clause 34, banning cold calling for CMCs unless the consumer has given their consent. With the two amendments on pensions and financial advice cold calling, the Secretary of State is giving herself a get-out clause, to shirk responsibility for taking action. Cold calling is cold calling. Consumers simply do not want to be bothered by nuisance calls, as we have already heard from the hon. Member for Stirling (Stephen Kerr) and my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson). Creating a complex framework around which providers are allowed to make these calls, on what types of product, under what circumstances, is over-complicating a very simple issue. People just want it to stop.
Will the Secretary of State, or the Minister who responds to the debate, explain why they think the need to ban CMCs’ cold calling is greater than the need to ban pensions or financial products cold calling? Tough action needs to be taken on this; otherwise, we risk creating loopholes that will allow cold callers to continue to operate.
I want to mention the duty of care amendment: new clause 6, tabled by Members on the Labour Front Bench. My colleagues spoke about it in detail on Second Reading, particularly my hon. Friend the Member for Inverclyde (Ronnie Cowan), who sadly cannot be here today to speak on it again. Applying a duty of care to CMCs would be a positive step in ensuring that such companies remain accountable for their actions if they cause harm to consumers.
Ideally, all financial institutions should have the best interests of vulnerable consumers at the heart of their conduct, but we all know that that is not always the case, and the fact that the Financial Conduct Authority has agreed to bring forward a discussion paper on duty of care is really positive. Macmillan has campaigned tirelessly on this issue, and I thank its staff for the briefings that we received ahead of these debates. We hope that the Secretary of State and Ministers will give serious thought to this idea, as well as to our amendment  on vulnerable persons, which ensures that the single financial guidance body expressly allocates resources for specialist support for people in vulnerable circumstances.
The SNP has long called for and campaigned for action on cold calling. Indeed, it was the subject of a ten-minute rule Bill proposed by my hon. Friend the Member for North Ayrshire and Arran. We welcome the fact that there is to be progress in this regard, but this area of the Bill is becoming a bit of a guddle. That is why we would obviously prefer to see powers over this area devolved to the Scottish Parliament, so that we could take more robust action, such as was suggested by the Scottish Government’s action plan on nuisance calls. Indeed, the Scottish Government Cabinet Secretary for the Economy, Jobs and Fair Work, Keith Brown, has written to the UK Government many times, asking for them to take a tougher line on nuisance calls.
Nuisance callers blight our society and cause significant distress, particularly to the elderly and vulnerable people. Such harassment is unacceptable and must be stopped. Hopefully, in the time we have available, we will take the opportunity to make some necessary improvements to the Bill.

Craig Mackinlay: I shall restrict my observations to pensions cold calling and unsolicited marketing thereon.
Last year, I was pleased to play a part in the scrutiny of the Pension Schemes Act 2017. It was timely legislation to ensure that pension savers were adequately protected as they saved, during the working period of their life, by the regulation of master trusts, which had previously been rather worryingly lightly regulated—insufficiently so, when for many, their pension will be their primary asset in life.
I am pleased that this Bill will bring together the Pensions Advisory Service and Pension Wise into a single financial guidance body, under the control of the FCA. I am further pleased to support the Government’s amendments, especially new clauses 4 and 9. It is right that the new clauses in the name of the Government allow the making of regulations to prevent cold calling and the sending of unsolicited direct marketing materials relating to pension savers. That is further strengthened in Government amendment 10.
At the core of what we shall hear in the House this afternoon is whether “may” should become “must”. That is at the core of an amendment tabled by the hon. Member for Eastbourne (Stephen Lloyd) and Willingdon —amendment (a) to Government new clause 9. There is a case for healthy competition. That usually results in lower charges, and that can be—can be—good for consumers. It would be a draconian measure to ban advertising, to entirely ban direct marketing, because that could be banning choice. It is often good advice for pension savers who have accumulated a pension pot to move to a provider who may provide a better pension, perhaps at a lower cost, with lower charges. That decision now rests with pension providers. If they do not act sensibly, that “may” in Government new clause 9 will, in certain circumstances, become a “will.” That is an important power.
At the heart of any marketing prohibition lies the well-founded fear of scams. The amount likely to be saved by UK pension savers, each with their own personal  defined-contribution pot, massively expanded by the successful roll-out of auto-enrolment, will in time be truly vast. There are currently 9.3 million people enrolled in workplace pensions. Where pension saving was once a rarity, particularly for the low-paid and the under-30s, it is thankfully now becoming the norm. A rough and ready calculation shows that in time the number of people enrolled in workplace pensions could well rise from 9.3 million to 15 million; I am sure that will be the appropriate figure in time. When we consider that from 5 April 2019, the combined employee and employer contributions will be 8%, we see that if that stays steady, using average salaries, and with a working lifetime of, say, 35 years, that will mean a pension pot in this country of over £1 trillion, and that is without investment growth. Of course, investment growth could be dented by the Labour party’s plans for a Robin Hood tax on financial transactions, but that is a debate for another day.

Alex Cunningham: The hon. Gentleman talks about a total pot in the trillions, but for the vast majority of people, particularly part-time workers, their pot, although better than nothing, will be relatively small. Does he agree that several groups are still excluded from auto-enrolment, and that the Government need to do something to bring them in?

Craig Mackinlay: I thank the hon. Gentleman for that contribution. There is a wide debate—I have taken part in it—about whether the self-employed are playing a full role in getting pension provision. I think that there are measures that could be taken, perhaps using the national insurance system, to provide them with greater certainty. The primary purpose of the Bill is to ensure greater financial understanding among the general population. They need to know where to turn at the right time. I have confidence that the single financial guidance body will achieve just that.
I close with a suggestion that is probably best directed to the Financial Secretary to the Treasury. It has some relevance to the honest proposals put forward by the hon. Member for Birmingham, Erdington (Jack Dromey) on mid-life reviews. Employees, as they work through their working lives, obviously have an employer. Employers are very well aware—possibly more than anybody else—of when an employee is approaching retirement. I am sure that most responsible employers will be keen to help. I recommend that the Secretary of State discuss amendments to the Income Tax (Earnings and Pensions) Act 2003 to allow employers to pay for advice, outside of any benefit-in-kind tax charge, so that advice can be provided to employees and paid for tax-free. That would extend a benefit-in-kind exemption similar to what we see when advice relating to settlement agreements, or payment for CV writing and recruitment advice upon redundancy, is duly paid for by an employer tax-free.
In my view, the Bill is fit for purpose and I very much support it.

Frank Field: I wish to speak to amendments (b), (c) and (d) to new clause 9, which stand in my name. As the House might know, they arise from the work that the Work and Pensions Committee did on miners’ pensions. For most people, decisions about moving pension capital are made towards the end of their lives, but miners had to decide where they should safely put their pension savings as a result of the change in the ownership of their industry.
Given the warning from the hon. Member for Airdrie and Shotts (Neil Gray) that we may not get on to the second set of amendments, I should mention that I have some amendments in that group to raise with the pensions Minister. Perhaps I may address two points to the Economic Secretary, but first I thank both Ministers for the way they have engaged with the Work and Pensions Committee for our report and in our meetings. We are immensely grateful to them. On some issues, I have joined my Front-Bench spokesmen because we have been pushing the same measures and interests.
I wish to raise two points that I hope the Economic Secretary will say will be added to the Bill. First, not only should cold calling become unlawful, but any information that arises from it should not be used for commercial purposes—that is, in respect of pension savings. Secondly, would it not be sensible to use the opportunity presented by this Bill to add the Financial Conduct Authority to the list of bodies in the Government’s policing arm to counter activities that unlawfully undermine people’s pension savings by trying to persuade them to move their assets in one way or another?
In the interests of getting on to the second set of amendments, I conclude my comments.

Jack Brereton: I am pleased to be called to speak in this debate, Madam Deputy Speaker, because the issues are of particular interest to me as a member of the Work and Pensions Committee. I want to reflect on some of the evidence the Committee has heard in its inquiry into pension freedoms and choice, as it relates to some of the changes proposed in the Bill.
While I am extremely supportive of the work the Government have done to increase the freedom of our constituents in respect of their pension savings, it has undoubtedly created new challenges that must be addressed. I am pleased that the Bill has been brought forward as an opportunity to address them. The first challenge is advice. It was apparent from our sessions on the British Steel pension fund that those who find themselves needing to switch often struggle to get the advice they need. There were mixed experiences, with some people receiving very good local advice and others receiving very bad advice or none at all.

Mark Tami: On the British Steel pension scheme, does the hon. Gentleman agree that the FCA has been very slow to react, when it was clear in certain locations that there were many problems with the way some people were advising people to get out of the scheme?

Jack Brereton: That issue certainly came up in our evidence. Those who saw our evidence sessions will know that there was quite a significant grilling of the FCA.
Those experiences show that some irrational decisions—often described as “emotional” decisions—were made in the moment. Sadly, those short-term decisions were not the best investment decisions for the longer term. Unfortunately, this vulnerability—the vulnerability of immediacy or a form of panic, one might say—allowed predatory vulture companies to take advantage of an emotionally charged situation, with people reinvesting their pension pots without the full, impartial advice  that is needed. Those vultures exploited scheme holders, framing what they were doing as giving impartial advice, when it was nothing of the sort. Many people felt that they were not fully informed of the consequences of the complex investment decisions they were having to make.
The accessibility of free independent advice in such situations has, in some cases, been woefully limited. More generally, the often perplexing nature of pensions leaves many people making decisions about their investments that are not necessarily in their best interests. Evidence presented to the Select Committee by the Association of British Insurers from the FCA’s “Financial Advice Market Review: Baseline report” suggests that not even one in 10 UK adults—just 6%—had received regulated financial advice. Worryingly, 25% of people who needed advice about their finances did not access it.
There are a number of reasons why our constituents are not accessing the advice they need, but what has been demonstrated is that not enough people are currently accessing the free independent advice that is available. The Association of British Insurers suggested that although 44% of people who are approaching retirement had access to some sort of advice, only 10% used the Pensions Advisory Service and only 7% used Pension Wise. The lack of clear advice combined with confusion about who to trust for independent advice has made it too challenging for those making investment decisions. Not enough people are getting the advice that they need to make properly informed judgments.
Secondly, we also found that very limited numbers of people are making the active decision to shop around and switch providers. Often, the tendency of those changing schemes is to stick to the same provider, so switching—active consumerism—is another challenge. There are, of course, a number of reasons why people might find it difficult to switch providers, not least the lack of good information and advice about the choices available, as I just related. It is also a major barrier to consumer activity, so I am pleased that part of the Bill proposes to create a single guidance body. That will make it much clearer for our constituents to see where they can turn for the right advice to make informed decisions and manage their finances for the future.

Alex Burghart: My hon. Friend is giving an important speech. Some of the evidence that we received on the Work and Pensions Committee was from Citizens Advice, which suggested that 97% of the pension scams that had taken place in one year originated from unsolicited calls. Does he think that the measures that the Government are bringing forward in the Bill will go some way to combating that?

Jack Brereton: I thank my hon. Friend for that point; I agree that it is critical that we take action to stop cold calls, and I am about to come on to some of those points.
This change will also ensure that the advice that is available is joined-up and better suited to our constituents’ needs, ensuring that decisions are not made in isolation, but with consideration to the wider implications of investment decisions on an individual’s overall finances. Measures in the Bill will also ensure that people receive the appropriate advice as a matter of course and that they should opt out if they do not wish to receive such advice. I also hope that the commitment made by the  Government and the industry to develop a pensions dashboard will be delivered, making it easier for our constituents to have access to the information that they need about their pension savings to make suitable decisions.
Thirdly, the Committee heard about the increasing number of pension scams that are being reported, with more people being actively deceived into making investments that are not in their best interests. It was suggested that many rogue companies are using cold calling to target people and to get them to invest without full thought of whether it is the right and best decision for them. I am sure that many right hon. and hon. Members have, like me, been contacted by constituents who have been continually badgered by cold calling. It is a real issue in Stoke-on-Trent South and I am sure that it is a challenge in other areas, too. Many of the people targeted by cold calling are elderly or vulnerable and are taken advantage of by those seeking to cheat our constituents out of their hard-earned life savings.

Michelle Donelan: Does my hon. Friend agree that although the pension freedoms that were introduced in 2015 were a fantastic opportunity for our constituents, they have led to an increase in rogue scammers and cold calling? That is why new clauses 9 and 4 are so important for the Bill.

Jack Brereton: I absolutely agree. That is why it is so important that this legislation is passed and that the Government have proposed these amendments. I am pleased that the Government have put measures in the Bill to ban the use of unsolicited marketing on pensions and financial products and services. It is a significant step towards preventing future abuses.
Of course, this legislation can never stop all scams being attempted—we cannot legislate away those who have nothing but contempt for legislation—but it does send a clear message not just to those conducting this behaviour, but to those who are at risk of being conned. By raising awareness of the challenge of scams, the Government can make more people wary of them. This will mean that those who are targeted can have the confidence that whenever they are cold-called by people trying to offer this sort of advice about their pensions or information about their investments, the calls are not legitimate but in fact illegal, and they should put the phone down. The Government are taking a balanced approach, acting if necessary to target where cold calling is most prolific and most damaging, such as in the area of pensions and financial products and services.
I support the Government’s efforts to encourage more people to take up advice at critical points in their life and to make the right investment decisions. I believe that the creation of a single body to give this guidance will make it much clearer where people can turn to for that independent financial advice, ensure they can get the more holistic advice they need, increase take-up and reduce the likelihood of people being successfully targeted by rogue companies. I also welcome the Government’s actions in proposing to take on unsolicited marketing and end the opportunities for rogue companies to target often vulnerable people through the use of cold calling. The Bill is in the consumer’s interest, because the Government are on the side of the hard-working saver, and it is for that reason that I am happy to support the Government’s amendments tonight.

Stella Creasy: I am delighted that we have finally got our time to debate the Bill; some people in Parliament might not be, but I believe that consumer protection is one of the most important things we can do in this place, because it speaks to the incremental unfairness that people face in life that individuals cannot face on their own but which together as a society we can tackle. In that sense, I rise to support amendments very much in vein, and one of their common themes is that they come from Co-operative as well as Labour MPs. The co-op movement has always been grounded in the values of consumer activism. I want to put on the record my support for amendments 31, 1 and 2, which my hon. Friend the Member for Harrow West (Gareth Thomas) will be speaking to later, and for amendments in the next group, which I want to get to, in the name of my other Co-op colleague, my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), amendments 5, 6 and 7 on mental health and debt.
In particular, however, in speaking to my new clause 1 and amendment 4, on the FCA’s potential role in tackling the impact of high-cost credit on our society, I want to repeat my Cassandra impression on debt. The Bill is about the fair treatment of consumers. I urge the Minister and the Government, in my Cassandra-like way, to learn the lessons of the payday lending industry. I do not need to tell any Member that the nation is drowning in debt, as we all have seen in our constituency surgeries. We owe more as individuals than do the Government: total household debt in June 2016 was £1.23 trillion, which is more than the Government’s national debt.
Average UK unsecured debt is now £14,000 and will be £19,000 by the end of the Parliament. The number of people who have gone bankrupt in the last year has soared to its highest level since the financial crisis. The reasons are not rocket science: there is simply too much month at the end of their money. Research now shows that economic insecurity has become the new normal for at least 70% of the UK’s working population, who the RSA has described as “chronically broke” and that 32% of the UK’s workers—people who are earning a wage—have less than 500 quid in savings and 41% have less than a grand. It is little wonder that a third are desperately concerned about debt.
Unemployment rates might still be dropping, but we all know that the cost of living has not dropped, and personal debt has filled the vacuum. So, too, has that insecurity, with 1 million on zero-hours contracts and nearly 2 million people in temporary work—and that is even before we get on to those in self-employment. In my constituency, 15% of people are self-employed. These are people who cannot predict their incomes. It is little wonder that the high-cost credit industry has been preying on these people.
One in 10 UK adults say their incomes change significantly from month to month, and almost half say they have experienced at least one monthly drop in income, with the average monthly drop being £385. Who of us could afford to lose that much from our monthly budget without there being consequences? Nearly half those people were self-employed or in that insecure work, which makes budgeting, on which much of the Bill depends, so difficult, and more than half said that one reason they experienced problems was an unexpected expense—a quarter had had two unexpected expenses.
The costs that people face when the washing machine breaks down or the landlord puts the rent up cannot be planned for, but they are all too frequently an everyday part of life. It is little wonder that nearly 6 million households now spend more than 60% of their income on essential outgoings. They have little flexibility in their budgets to begin with, so when those unexpected costs come, of course they turn to borrowing.
We know that that is not the case for everyone. We know that there are very wealthy people whose incomes are about five times as much as those of the people in the bottom half of our income stratosphere. That is what the new clause and the amendment are about. There are people who can manage borrowing well within their budgets, but the reality of modern-day Britain is that there are many more people for whom borrowing in itself becomes the problem. We know that 25% of the UK’s lowest-income households are struggling with debt and experiencing that “chronically broke” feeling. It is little wonder that it causes so many health challenges.
It is not the traditional demons to which people who are struggling are now turning. We did make progress on payday lending—the so-called legal loan sharks—but that industry does not go away; it simply mutates. It simply finds new ways in which to prey on those people. The new clause and the amendment are about credit cards. I would wager that most Members have one credit card, if not two, in their pockets. Many of us may also have had that conversation with constituents who have come to us when they are about to be evicted because they cannot pay their rent and are behind with their costs. When we ask them, “Do you have any debt?” they say, “No.” When we ask, “Have you a credit card?” they say, “Of course.” Because credit cards are so ubiquitous in our society, we do not think of the danger that they can be.
That is why I tabled the new clause and the amendment. As the Minister knows, I am frustrated with the Financial Conduct Authority, which has been looking into credit cards but does not see the risk. This is where I become Cassandra, because the risk is all too obvious. Of course there are people for whom credit cards work well, but we know that a significant chunk of the British population are in persistent debt and that their credit cards are an integral part of that debt. They are paying about £2.50 in interest and charges for each £1 of their borrowing that they repay. That matters, because we stopped it happening in the payday lending industry by introducing a cap.
My simple question to the Minister is this. Why do we want to protect one group of consumers from that kind of persistent debt, but fail to learn the lessons when it comes to other types of product? The issue is not whether the credit involves a payday loan or a credit card; it is the credit itself, and the cost of the credit. I hope to convince the Minister of that.
When we look into consumer debt, we can already see just how damaging credit cards have been. At the end of 2016, consumer credit debt amounted to £236 billion, which is about 15% of total household debt, but it accounts for half the interest payments that are made each year. When the FCA conducted a survey of credit card debt, it found that 19% of consumers—one in five—paid just the interest rather than the repayment charges. What could be called “zombie debtors” had  5.1 million accounts. On average, it would take them more than 10 years to pay off their debt. They are stuck in debt because of their credit cards. Little wonder that 40% of adults say they sometimes struggle to make it to payday, and a third of them say that it is because they are making credit card repayments. Debt is breeding difficulty, and difficulty is breeding more debt for them and their communities.

Luciana Berger: I thank my hon. Friend for making such an impassioned speech about such a serious issue. I am sure that there are Members in all parts of the House who meet constituents in their surgeries and hear about their credit card debts, involving not just one card but, in some cases, two, three, four, five, six, seven or eight. It is the people with the most debt who are preyed on by those who give them access to additional cards, which only add to their burden.

Stella Creasy: My hon. Friend is absolutely right. It is no surprise that she has done so much work on the link between debt and mental health issues.
We are already seeing in the credit card industry the same patterns that we saw in the payday lending industry. If we are honest, we must admit that it took us too long, as a House, to act in respect of that industry. So many of us saw people in our constituency surgeries who were losing their homes and people who were massively in debt because they had become stuck in payday loans that they were using to pay for basics such as rent and food. But when we did act, what a difference it made. Bringing in a cap on the cost of credit has led to an 86% reduction in the number of people going to citizens advice bureaux with problems caused by payday lending. So one question for us is what the consequences will be if we do not act on credit card lenders. The Minister may say to me that the credit card industry is completely different from the payday loan industry—that is what he said when we had an Adjournment debate about this—so let me try to convince him that the two are intertwined.
I see in my local community, as other Members may have seen, companies such as Vanquis, Aqua and Capital One—indeed, Vanquis is owned by Provident, which is a doorstep lending company—offering credit to people who have bad credit histories and driving them into the same level of debt as payday loans did. Indeed, the FCA’s data shows exactly that, which is why it is such a mystery to me that it does not choose to learn the lessons from the payday lending industry and act accordingly.
Someone who has an Aqua credit card with a monthly interest rate of 3.992%, has borrowed £1,000 and is only paying the minimum monthly payment will pay £480 in interest by the end of the first year. By the end of the second year, the figure will be nearly £1,000—as much as they borrowed, which is the cap that we have put on payday lending. By the end of the third year, bearing in mind that a big group of consumers get stuck in this way for 10 years, they will have paid back double what they owed. Such companies are targeting our communities in much the same way as the payday lending industry did. They are targeting people with insecure incomes, because they have seen a new market. As I said, this industry does not go away; it just mutates.
Citizens Advice’s recent research about insecure income shows us just how much of a problem there is. People with high levels of income volatility are also five times as likely as others to have accessed this form of high-cost credit to meet the essentials—to put food on their table, to put petrol in their car to get to work and to pay their rent. Those are not costs that they can cut back on but the costs of everyday living. People with volatile incomes are also more likely to be paying fees and charges on cards, as well as overdraft fees.
That is why it is frustrating that, from the get-go, the FCA ruled out capping the cost of credit on credit cards and so learning the lesson from payday lending. It thinks the answer is to ask people to pay back money earlier, as if they have the spare cash to do that. It is not a fair fight for individual consumers against credit card companies, just as it was not a fair fight against payday loan companies. That is why we should intervene to set a fair market and learn the lessons about capping.
My new clause 1 does something simple: it asks the new financial guidance and claims body to step in, because the FCA is not doing its job and looking after the interests of consumers. It is not recognising, as Cassandra does, the risk that is coming and acting to avoid it. It says that persistent debt is when somebody pays 100% in interest and charges on top of the amount to be repaid, but it is not applying its own rule to credit cards even though we have seen how effective it has been in the case of payday lending.
I ask the Economic Secretary to show the leadership that this issue needs and that I believe the House would support. If he says today that he will take a strong hand with the FCA and not let it wait years and years, watching our constituents get into consistent debt with credit cards, logbook loans or any other form of high-cost credit, he will have my backing. I have tabled my amendment and new clause to give him the opportunity to tell us that he gets it. The House does not want to wait another five or six years watching our constituents get into debt, as we did with payday lending. I am sure the Government would not want to be forced to cap the cost of credit, as we had to force them in that case, and I am sure that he is proud of the difference that capping the cost of credit for payday lending has made to millions of consumers in this country.
FCA data shows us that millions of credit card owners need our help and protection now, which is why I have tabled the new clause and amendment. I believe that there will be support for them, but I want to give the Economic Secretary the opportunity to do what I know he wants to do, which is to ensure that we do not leave it so long this time. I look forward to hearing what he says, and I hope that other Members will support my call, because frankly, there are too many people in our constituencies who need and deserve nothing less.

Craig Tracey: First, I should like to declare an interest as the current chair of the all-party parliamentary group on insurance and financial services. I welcome the Bill, because it will tackle some of the important issues that my constituents talk about. It includes a commitment to ban cold calling relating to pensions and to the creation of a single financial guidance body—an SFGB. I know that this approach also has the broad support of the insurance  and financial services industry, but it is important that the SFGB should work with all stakeholders to fulfil its objective and of course ensure good consumer outcomes. With the Bill, we have an excellent opportunity to improve financial resilience by promoting early intervention to help to prepare people for income shocks and life events. These preparations include planning ahead for care and understanding the benefits of protection products such as income protection insurance, critical illness insurance and life insurance.
There is a lot in the Bill that I could talk about, but given the time constraints, I want specifically to speak against new clause 8, which seeks to put a duty on the Financial Conduct Authority to ban unsolicited direct approaches by claims management services. I agree with the Government that the Information Commissioner’s Office is best placed to implement any ban and that existing legislation means that data gained illegally is already restricted. However, I agree that there is an urgent need for reform relating to claims management companies.
Previously, there have been calls for the FCA to assume responsibility for CMCs, so the fact that the Government have taken action on this is to be warmly welcomed. The Association of British Insurers has stated:
“Confirmation of tougher regulation of claims management companies cannot come soon enough for people who are plagued by unsolicited calls and texts. Disreputable firms are fuelling a compensation culture that contributes to higher insurance costs for many.”
Last year alone, there was a total of 752 authorised personal injury CMCs, more than in any other claims sector, including PPI. Measures in the Bill will go some way towards tackling bad practice in the personal injury claims market, which has been costly for insurance companies, put up premiums for consumers and frequently delivered outcomes in which claimants’ interests were not put first.
Added to some of the measures in the forthcoming Civil Liability Bill, such as tackling the high frequency of whiplash claims, this Bill will help to ensure the success of the Government’s wider efforts to tackle these problem areas. It is therefore encouraging that the insurance industry has expressed confidence in the FCA’s more robust regulatory regime and its ability to properly oversee these firms, citing two significant benefits, both of which will play a vital role in addressing the problems associated with this sector.
First, a strong regime based on understanding the business models of individual CMCs will prevent firms that do not offer good value to consumers from operating. Secondly, personal accountability for senior managers of CMCs will ensure that when a firm struck off, its directors cannot simply resurface as a new CMC, as is currently happening. It is anticipated that, as a result of this change, consumers will be given more information about the services that CMCs offer and more transparency about the fee structure. It is therefore important that the improved regulation of CMCs should be implemented alongside the personal injury reform proposed in the Civil Liability Bill. It can only be good news for consumers when their interests are put above all others.
As I have said, this is an excellent Bill, but I would like to propose a couple of areas in which I think it could be strengthened, and I ask the Minister to take them into consideration when summing up. First, it  would be useful if he clarified the exact scope of the services that the SFGB will provide for consumers. There is a great opportunity to look at how the Department for Work and Pensions could work with the financial services industry to make guidance a recognised norm and to look at ways to support interventions that could improve the retirement process, such as the introduction of a mid-life MOT.
Secondly, will the Minister provide a timeline for the introduction of the FSGB and tell us when the FCA will assume responsibility for CMCs? Swift action is necessary, particularly in relation to CMCs, given the drastic spike in claims relating to gastric illnesses by people who have been on holiday. It is no coincidence that this surge has coincided with CMCs preparing for the deadline for bringing PPI claims and the introduction of measures to tackle whiplash claim frequency.
The Opposition amendments to this part of the Bill are unnecessary. The Government are committed to banning cold calling in relation to pensions and by CMCs. Moreover, they and the SFGB will keep cold calling under review. If the Minister will give consideration in his summing up to the points I have made, I will have no hesitation in supporting the Government through the Bill’s remaining stages.

Gareth Thomas: I rise to speak to the three amendments in my name. According to a recent Bank of England survey, the average level of household debt, excluding mortgages, is £8,000. While everybody should be able to access basic debt advice, people on low incomes with much higher levels of debt, at higher rates of interest, clearly need significant support. Unlike in the United States, it is difficult to work out with any certainty where such people are living in the UK, beyond relying on an individual to approach their local citizens advice bureau or another advice service.
At present, the new financial guidance body will not have access to data to allow for a detailed mapping of debt at a local level. Indeed, it will not have access to a full picture of the activity of banks and other lenders in our communities. There is no requirement on banks, payday lenders and other financial services providers to be fully transparent about the services in each of our constituencies—specifically where they lend, what rate they lend at, and the types of loan that they offer. Were that data available to public bodies, it would allow for the accurate mapping of who is lending and what is being loaned. Banks and other lenders do hold such data down to postcode level, and such data are released in the United States. Many British lenders that are active in the US are used to releasing that information, which allows public bodies to map the activities of banks and other lenders.
My amendments 1 and 2 would allow the single financial guidance body to facilitate the release of that information by lenders in an anonymised form so that we could know where debt is concentrated and what types of credit are used in different areas. That would allow for better, more strategic responses to the household debt crisis with which the House is familiar. The data would help to inform where to target the debt advice funding that the SFGB will dispense, encourage more engagement between mainstream lenders, and allow the  community finance sector to scale up the provision of affordable credit in areas where there are specific problems. Indeed, such data would reveal market gaps and the communities excluded from mainstream credit.
Fair access to financial goods and services is a basic requirement for full engagement in modern society, but Thamesmead, an estate of 55,000 people in south-east London, has not been home to a mainstream bank branch for a long while. Charities report anecdotally that high-cost credit lenders such as doorstep or payday lenders are very active. More and more bank branches are being closed by the big banks, which is leaving whole communities, some in the poorest areas of our country, without a single mainstream bank branch. Thamesmead is not an isolated example.
At the same time, rumours persist that the big banks want to pull the plug on free cash machines. Which? has reported that over 200 communities in Britain already have poor ATM provision or no cash machines at all. The combination of a lack of access to cash machines and to mainstream bank branches could create the space for a much bigger increase in the activities of high-cost credit companies, doorstep or payday lenders or, worst of all, illegal loan sharks, as a response to the needs of people in such communities for short-term loans. We need to know where the other Thamesmeads are across the country so that charities, community banks and credit unions can be supported by the financial guidance body and other statutory bodies to target financial exclusion in such areas by signposting people to responsible financial providers.
In 2015, when considering this specific problem, the Financial Inclusion Commission, which was set up by the Government, argued for a much wider level of data disclosure to develop a greater understanding of the problem. It said specifically:
“If lenders were required to disclose data by postcode on credit applications and rejections, policymakers would be better able to understand the scale and shape of the low income credit gap.”
Since the financial crisis, banks and other lenders have withdrawn from higher-risk lending and raised the threshold for accessing mainstream credit. In turn, this has restricted the credit available to those with low credit scores, leaving them at the mercy of higher-cost lenders to bridge their income gap. Surely part of the long-term solution to the household debt crisis is to make it easier for low-cost credit providers and other alternatives.
It is true, as Ministers have previously suggested in Committee and in a letter to me, that there are other sources of data on debt. The Office for National Statistics and the Bank of England publish data on lending, but only at UK level—the data is not broken down by constituency or by area. StepChange, too, publishes some data on lending, as does the Money Advice Service, but the Minister might not be aware that it publishes only estimates of the number of people who are over-indebted.
I would not dream of criticising the Money Advice Service, but its data on lending does not go anywhere like far enough to meet the recommendations of the Financial Inclusion Commission. The Money Advice Service does not routinely collect information about the extent of debt problems at the most local level. Its last significant report was back in March 2016, and it set out estimates of the number of over-indebted households down to local authority level, not postcode level, which is  what we need. The Money Advice Service data are estimates based on survey work, not actual individuals who take out loans.
I should be clear that some lending data is already released. The coalition Government, to their credit, required the British Bankers Association, which is now UK Finance, and the Council of Mortgage Lenders voluntarily to publish some data by postcode, primarily to try to tackle the challenges that small businesses were facing when accessing credit.
There are problems with the data. For example, it does not include high-cost, short-term credit—payday lenders. Additionally, it does not disclose lending levels or rates at postcode level. Some details of loan applications and credit providers’ registers are not released either, so a full picture of the level of lending at a postcode level has not yet been able to emerge.
At the moment, the data is released voluntarily. Legal underpinning is needed so that more statutory bodies working in this field can more easily negotiate improvements in data. Specifically in this context, for example, the single financial guidance body should be able better to negotiate the release of the data that it needs.
I say this gently to the Economic Secretary to the Treasury, who will be very helpful to me tomorrow, but efforts to re-engage the Treasury in getting UK Finance to improve the usefulness of the data its members release have not had much success recently. At the very least, I hope he will be willing to join me in meeting national groups operating in this field to hear their concerns about the data, and perhaps he might be willing to use his leverage to get at least small improvements in that area.
In the United States, the Community Reinvestment Act means that banks and other lenders have to report what they are lending, where to and at what rate. The disclosure requirements are critical as they enable independent, informed assessments of what the banks are doing. Crucially, they keep the banks honest. Before the CRA, access to credit was scarce in deprived areas, and that lack of access contributed to and prolonged the decline and deprivation in such communities.

Gareth Snell: My hon. Friend makes an excellent point, but does he agree that the disclosure of such data would highlight the hotspots in communities such as the ones that we represent, and would therefore allow the Department for Work and Pensions to put in the necessary resources so that jobcentres and other advice bureaux can act as a preventive measure so that we do not see more of our constituents with little chance of getting out of the vicious circle of high-cost borrowing?

Gareth Thomas: My hon. Friend makes a good point.
In the United States, federal banking regulators regularly assess how banks are meeting local credit needs. Their assessments affect the way in which the banks are allowed to expand, merge, do acquisitions and so on. Banks can get credits towards their assessments if they invest in community banks or credit unions. Not surprisingly, both the community banking movement and the credit union movement are in even better health in the US than they are here.
Santander, HSBC and Barclays all operate in the United States, where they release far more data on lending, down to postcode level, than they do here. So surely the questions for this House are: why are they not willing to do that here, too; and, as I believe, should they be forced to do so? Last October, Santander announced an $11 billion, five-year settlement on lending and community development in eastern parts of the United States, which is the market in which it operates. That represented a 50% increase in its Community Reinvestment Act-related activity. No such equivalent increase has been announced here in the UK. The Community Reinvestment Act has cross-party support in the US, being backed by Republicans and Democrats alike, including for its data disclosure requirements. If Ministers are not prepared to accept my amendments, I would wish, with your permission, Madam Deputy Speaker, to press amendment 1 to a Division. These amendments are not onerous. Banks and other lenders record this data, and although a little work would be needed so that the information could be released in a useful format, a similar system works particularly well in the United States. In turn, the disclosure of lending details could help the single financial guidance body to make more effective choices.
I shall deal briefly with amendment 31. One key challenge for the single financial guidance body will be, as we all know, to help those who need loans, for whatever reason, to access the cheapest products—those offered by credit unions fall into that category. Surely the SFGB should be mapping where credit unions exist and what further action can be taken to promote the take-up of their services by those who are most in need. Credit unions have very low administration costs. They simply do not have the megabucks of a major bank or a payday lender’s marketing department, so many of those who most need the support that credit unions can offer are often unaware of the services they provide. Surely another challenge for the House is to work out how we help credit unions to make more information available about the products on offer. I know that Ministers are sympathetic to efforts to expand the credit union sector, so I ask them to give specific attention to thinking about what further steps can be taken to help the credit union movement to expand and to support the SFGB in achieving that aim.

Julian Knight: I refer Members to my entry in the Register of Members’ Financial Interests. I completely agree with what the hon. Gentleman says about credit unions. Does he agree that one key aspect of trying to promote them is improving their professionalism, IT and this information, and using the potential for workplace credit unions? Should we not try to bring this through the workplace and payroll?

Gareth Thomas: I agree with that point, which is why it has been encouraging over the past 10 to 15 years to see Departments beginning to do their bit to encourage the workplace take-up of credit unions. I hope the Economic Secretary may be able to tell me that Her Majesty’s Revenue and Customs will follow this trend soon, but the point about trying to increase professionalism is well made. Again, it would be good to hear commitments from Ministers that some of the problems that credit unions face due to poor regulation by the Financial Conduct Authority will be dealt with.

Gareth Snell: I apologise for intervening again, Madam Deputy Speaker. I was a director of a credit union in Staffordshire, but unfortunately it went under because the regulation from the FCA simply meant that it became unviable, because the authority did not understand the operating model. I therefore very much agree that the FCA has a big role to play, along with the Government, in making sure that credit unions are sustainable, because they offer a hope for constituents who would otherwise use high-cost lending.

Gareth Thomas: My hon. Friend amplifies the point I was making. One last point to make is that there is a need for legislative change to allow credit unions, in particular, to offer loans for cars and—

Eleanor Laing: Order. Before the hon. Gentleman comes to his last point, there seems to be a lack of understanding generally in the Chamber about what happens at this stage in a Bill. I cannot put a time limit on speeches; this is Report stage. We have two groups of amendments to go through, and we have until 6 o’clock. Many questions have been asked, and Members will expect the Minister to have some time to answer them.
If we go on as we have done for the last two hours, there will be no debate on the second group of amendments. It will not be up to me to explain to the hon. Member for Liverpool, Wavertree (Luciana Berger) why she does not get to make her speech on her amendment in the next group. Every minute that people take in this House takes away from another colleague. Of course, there are people who prefer to hear the sound of their own voice, who only want to hear their own arguments and who will not give time for others, but I am warning now that if speeches take more than three minutes, we will get to a stage whereby the second group of amendments will not be heard. I cannot stop the hon. Member for Harrow West (Gareth Thomas) finishing his speech—he can take as long as he likes, as far as the Chair is concerned—but I am sure that he will have a view to helping his colleagues.

Gareth Thomas: I had finished, Madam Deputy Speaker.

Eleanor Laing: I am delighted to hear it.

Stephen Lloyd: You make a salient point, Madam Deputy Speaker. I have been sitting here for two hours, so I agreed with a lot of what you said.
I am glad that we are finally concluding our consideration of the Bill. I rise to speak to amendment (a) to new clause 9, as well to new clause 7, amendment (a) to amendment 10 and amendment 34. The Liberal Democrats welcome the amendments that the Government have tabled, but we believe that they do not go far enough.
The Bill as introduced in the other place had three major flaws. First, the single financial guidance body had no explicit function to protect consumers. Secondly, the Government missed an opportunity to ban cold calling by claims management companies, as they had promised to do in their manifesto. The ban should also have extended to other financial products. Thirdly, there were no safeguards to ensure that people received financial guidance before they accessed or transferred their pension benefits.
I pay tribute to my Liberal Democrat colleague in the other place, Lord Sharkey, whose amendments to the Bill paved the way for the concessions that we have today. I know that he and others from across the political divide have been lobbying Ministers intensely behind the scenes. It would have been nice if the concessions had come earlier in the proceedings, but there we go.
My support for the concessions is not absolute. In particular, under clause 34, claims management companies must act as though all UK phone numbers are registered with the Telephone Preference Service. As the House will be aware, however, the TPS has proven to be somewhat ineffectual. The Information Commissioner’s Office received more than 11,000 reports of cold calls from people on the TPS register last year. We believe that the Financial Conduct Authority has more teeth to enforce a ban on cold calling by claims management companies. For that reason, we support new clause 8, which would put Lord Sharkey’s amendments back into the Bill. The other amendments to new clause 9 would have a similar effect, allowing the FCA to police the ban on pensions cold calling.
Government new clause 9 allows Ministers to ban pensions cold calling and, if they do not, they must lay a statement before Parliament each year. Although I would love to name and shame Ministers every year until a ban comes into effect, I would rather that they just got on with it. Amendment (a) to the new clause would make it a legal requirement for the Government to ban cold calling, rather than just an optional extra.
New clause 4 allows the Government to ban cold calling in relation to any other financial services product after receiving advice from the SFGB. I welcome the amendment, but Lord Sharkey and I are worried that the SFGB’s duty to report on cold calling “from time to time” is too weak. I have tabled amendment (a) to amendment 10 to ask the SFGB to publish its report on cold calling at least every two years. This duty should not fall quietly by the wayside.
I also encourage the Government to accept amendment (b) to new clause 9, which was tabled by the right hon. Member for Birkenhead (Frank Field). As my colleague, Lord Sharkey, pointed out in the other place, a ban on cold calling must also include a ban on the commercial use of data obtained by cold calling. This gives the Information Commissioner two bites at the cherry to punish companies flouting the ban.
I now turn to the two amendments that I tabled on income shocks. They would require the SFGB to improve the capability of the public to plan for sudden reductions in income. The issue was brought to my attention by the former Pensions Minister, Professor Steve Webb, and the Chartered Insurance Institute, to which I am very grateful. Too many people are unprepared for a sudden fall in income. The 2015 financial capability survey found that 26% of working-age adults have no savings to fall back on and that a further 29% have less than £1,000 saved. There are many reasons why income shocks could occur. Money Advice Service research from 2016 found that nearly three in four households receive an unexpected bill every year. One third of households have had to make an unexpected car repair or replacement, at a cost of £1,300 on average.
The “Improving Lives” Green Paper revealed that 1.8 million employees have a long-term sickness absence of four weeks or more in a year, yet statutory sick pay is worth less than three hours’ work a day on the national  living wage. This problem is made worse because, as the FCA has noted, people with serious illnesses often have poor access to financial services, particularly insurance.
Amendments considered in the other place also touched on this issue. In response, the Government said that public preparedness for income shocks would be an aspect of the money guidance function. Although I welcome that commitment, I would like the Minister to go further. The Bill contains no specific direction for the body to improve preparedness for income shocks or any mechanism to measure the progress of the body in this regard.
The SFGB’s focus will be pulled in every direction. How will the Government convey to the SFGB the strategic priorities for the coming year, and how will Parliament and the public be able to scrutinise and evaluate that work? The Government have finally listened to the arguments made on these Benches and in the other place. I thank them for doing so, but they must now go the distance. They must take robust action to end the scourge of cold calling and protect millions of vulnerable people from sudden income shocks.

Steve McCabe: I apologise for missing the earlier part of the proceedings; I was chairing a debate in Westminster Hall.
I want briefly to voice my support for amendments 8 and 9, to which I have added my name, and also for new clause 8, in my name, which effectively repeats amendment 42 as proposed by Lord Sharkey in the other place. As Members will know, that amendment was withdrawn on the solid understanding of a promise by the Minister in the Lords who said that her officials were working through the detail of a ban on cold calling. She went on to say that the Government would bring forward amendments to this House to implement that ban. Plainly, they have not done so.
I am not quite sure why the Government have backtracked on what seemed to be such an obvious and solid promise. It might have seemed that focusing on the role of the Information Commissioner and Ofcom was the easy option, but, with all due respect to the hon. Member for North Warwickshire (Craig Tracey), the kind of cold calling that innocent people are being subjected to every day is actually a cold, calculated business strategy; it is not only an issue about the misuse of personal data, important though that may be.
This Bill is supposed to be designed to ensure that people are protected and that the financial decisions that they make are taken after careful consideration and access to independent guidance. Why on earth are the Government reneging on their promise to eliminate cold calling for commercial purposes, the aim of which is to bounce people into decision making and deny them the time for proper, careful consideration and access to good guidance? New clauses 3 and 4 simply will not do the trick. People may well see them as a deception—an attempt by the Government to fool people into thinking that they are taking action when they are not really doing so at all. Everyone knows that it is a complete nuisance and underhand practice designed to entrap consumers.
Let me spell it out: I welcome the action that will be taken to try to protect those whose pension pots are the target of tricksters and speculators; but we also need to  ban the claims management companies that phone people up to tell them about the accident that they have been involved in or the compensation they are entitled to for the tummy bug that wrecked their holiday. Those companies are nothing more than scam merchants, and this place should exist to expose them and put an end to their shoddy practices. Nothing else will convince the public that this Government are genuine when the Prime Minister talks about being on the side of the little person, rather than vested interests. We should demonstrate whose side we are on tonight. I want to hear the Minister say that he is going to put an end to this practice once and for all, and I hope that my own Front Benchers, having reflected on the situation, might indicate that they are willing to put further pressure on Ministers with regard to new clause 8.

Alex Sobel: I am here to support the amendments in the names of my hon. Friends the Members for Walthamstow (Stella Creasy) and for Harrow West (Gareth Thomas), which are complementary. I have also put my name to amendments 1, 2 and 31 in the name of my hon. Friend the Member for Harrow West.
Why do the poorest in our society have to pay more for the same services as the wealthiest? Why do they have to pay more for the same gas and electricity? Why do they have to pay more interest for the same loans? Why is credit more difficult to access and at much higher interest for the poorest in society? The structure of our society is such that growing inequality is in-built, because those with capital can further accrue it through cheap finance and lower costs, while those without capital cannot pursue their dreams through the high costs and limited availability of debt finance. Today we have an opportunity to make a small step in reversing that trend, casting light on the practices of high-cost credit providers and enshrining the duty to ensure that information about credit unions is provided by the single financial guidance body. The very mission of credit unions is to provide low-cost finance to people who are deemed high risk by traditional institutions, and they are owned by their own members.
Martin Luther King said:
“it is obvious that if a man is to redeem his spiritual and moral ‘lag,’ he must go all out to bridge the social and economic gulf between the ‘haves’ and ‘have not’s’ of the world. Poverty is one of the most urgent items on the agenda of modern life.”
Today we have the opportunity to pass these most excellent amendments and make a step towards bridging that social and economic gulf, not just because it makes sense in terms of financial justice, but on a spiritual and moral level.
The United States acted 40 years ago on the spiritual and moral lag that Dr King talked about, by introducing the Community Reinvestment Act. The Act was established to ensure that banking needs were met and monitored in low-income neighbourhoods, which had seen a retreat of traditional banking services and rising interest—a situation that we have faced in this country for far too long. My hon. Friend the Member for Harrow West gave an excellent explanation of the Community Reinvestment Act, so I will not repeat it. The banks in America have responded to the Community Reinvestment Act by establishing plans to service those communities and ensure that their services are not restricted. Banks in the US with community investment plans not only commit capital at affordable rates for loans, but invest in community development.
The amendments are needed before we can implement a community reinvestment Act. Without the disclosure of financial data and a statutory duty to promote credit unions, we cannot achieve community reinvestment by the large banks. The amendments are a necessary but insufficient precursor to getting real financial justice for communities that struggle to access affordable credit, but today we can make the first step to ensuring financial justice and legislating for a full community reinvestment Act. I hope that the Treasury Bench takes on board these excellent amendments and responds to them in kind.

Alex Cunningham: I want to speak briefly to new clause 2. While I am sure, Madam Deputy Speaker, that you have many years to go before you reach your own mid-life point, I am sure you will understand that we could all use a bit of advice at times—even though those of us with six decades or so behind us think it our duty to pass on pearls of wisdom to the younger generation.
There is plenty of talk about young people and their finances—about how they can manage their cash and get on the property ladder, which is of course impossible for many these days. This Bill does something to help young people, and I am pleased about that, but what it fails to do is help those in the mid-life stage—people who may have saved a bit, joined a pension scheme, or bought an ISA or two. More importantly, it does nothing to help those who have done none of those things and simply do not know who or where to turn to when planning their later life.
Although some excellent initiatives have passed through this House, such as Labour’s policy of auto-enrolment into workplace pensions, there have been a number of failures, not least around the issue of ’50s-born women and their state pension age, which was extended by the Tory-Lib Dem coalition by several years, condemning many such people to poverty when they should have been enjoying retirement. We could have hoped that the experience of thousands of women left facing difficulty and uncertainty would act as a salutary lesson to everyone else that they cannot really depend on Governments to deliver the security they need in retirement, but need to find ways to make provision for themselves.
People are now looking at their expected pension provision, if they have any, and then panicking about how they are going to afford to live when they retire, or are faced with the reality that they will have to work beyond retirement age in order to make ends meet. We also have people who have lived their lives just getting by—who have never been able to buy their own home and now do not know how they will afford their rent once they retire. Uncertainty is very much the name of the game in the 21st century, so we have a responsibility in Parliament to make provision to ensure that everyone, whether they can afford it or not, is able to work out how they will live when they are no longer receiving a wage. This new clause to provide targeted information to people from the age of 50 delivers that.
We all know that people can now expect to have several jobs throughout their career, and redundancy, zero-hours contracts and insecure work are clouds hanging over millions of people every day. Some people in their 50s find that they need to retrain for another role, but many do not know where to begin or where to get to the facts. This body, backed by the right promotional  campaigns, including multimedia, could be a lifeline for those who ignore their money problems. I am, however, concerned about the capacity of the new body. We need to guarantee that it can expand if we are to reach many more people with guidance. I am yet to be convinced that that capacity will be there. I hope that the Minister will say something about how it can expand. I also hope that he can extend its services to provide the mid-life advice that people need.

Yvonne Fovargue: I, too, want to support my hon. Friends the Members for Walthamstow (Stella Creasy) and for Harrow West (Gareth Thomas). I hope that the FCA will look speedily at the total cap on the rent-to-own sector, with its inflated prices for goods and roll-up charges.
I am pleased that the Bill aims to ensure that members of the public can access good-quality, free-to-client impartial financial guidance, pensions advice and debt advice. Clauses 10 and 11, which relate to my amendment 42, require the single financial guidance body to set and enforce standards across the debt advice partners it commissions. I think that everyone agrees that the body will have to have regard to standards of practice for the organisations it commissions, but the respective roles of the single financial guidance body and the FCA should not create uncertainty. There may have to be additional requirements for organisations that it commissions.
However, an independent report to the Debt Advice Steering Group run by the Money Advice Service says that the quality assurance process for the larger debt advice charities should be authorised by the FCA. The concern is that any such new and additional requirements from the single financial guidance body should not replicate the requirements faced by the debt advice organisations from their regulator, the FCA. Having had a contract from the Legal Aid Board where we had three auditors in at one time, I was tempted just to throw the files into the middle of the room and say “Fight over them.” The auditing ought to be in the same capacity, and it should be done under one audit that covers all if there are the same requirements.
The body’s standard-setting powers also need to be matched with principles of good regulation, and conditions ought to be proportionate to the benefits they will bring. Amendment 42 would make that plain. Ensuring that the new body’s standard-setting powers have regard to proportionality would smooth its functioning, guarantee assurance and stop the uncertainty as to whether the FCA or the single financial guidance body has primacy.

Ellie Reeves: I want to speak to amendments 8 and 9, which, unlike new clause 4, would lead to an outright ban on cold calling by claims management companies.
Claims management companies make and send around 51 million personal injury-related calls and texts each year. Such calls are not only a nuisance; they exploit vulnerable people. It is worth reiterating that solicitors are already banned from cold calling in personal injury claims, but the fact that claims management companies are not risks bringing the sector into disrepute. Cold calling can generate the false perception that obtaining compensation is easy, even where there is no injury. It can put pressure on people to pursue unmeritorious or,  at the worst, fraudulent claims, which they otherwise may not do. It may never have been someone’s intention to make a claim, but if they receive a text promising them thousands of pounds, it might seem very tempting.
There is an important context. The Government are proposing to reform compensation rules for whiplash claims and to increase the small claims limit in road traffic accidents from £1,000 to £5,000, and in public liability and employers’ liability claims from £1,000 to £2,000. The Government say that that is to cut down on fraudulent claims and to bring down insurance premiums. However, many, including myself, are concerned that that will have a significant impact on access to justice, with people not being able to access proper legal advice in such claims.

Ruth George: Does my hon. Friend agree that a total ban on cold calling, including from claims management companies, would be a much more proportionate response to insurance industry claims of fraud within claims management, and that that should be looked at before any action that will impact on innocent victims of road traffic accidents and employer injuries?

Ellie Reeves: I absolutely agree. Surely a better solution to this issue is to have an outright ban on cold calling in personal injury claims by claims management companies, which is exactly what amendments 8 and 9 would do.
New clause 4 gives the single financial guidance body the ability to advise the Government if it considers a ban on cold calling by CMCs to be necessary. If the Government receive such advice, the Bill gives the Secretary of State the power to impose such a ban. However, the Bill does not compel the single financial guidance body to give such advice in relation to cold calling; nor are the Government required to act if they receive advice.
Although the Government have promised decisive action from the outset, I am concerned that the Bill is filled with ifs, buts and maybes and still falls far short of a ban on cold calling. Amendment 8 would commit the single financial guidance body to advise on how best to implement a ban within 12 months of the Bill being passed, and amendment 9 would require the Government to act outright and impose the ban. A ban on cold calling commands support from over two thirds of the population. We must respond to that and strengthen the Bill by agreeing to amendments 8 and 9, to see through a complete and necessary ban on cold calling.

John Glen: I am acutely conscious of the need not only to get on to the second group of amendments but to respond to the amendments in the first group. I will do my best to address all of them, and I will give myself five minutes to do so.
I will start with new clause 7 and amendment 34, tabled by the hon. Member for Eastbourne (Stephen Lloyd). The body is already expected to develop a national strategy to improve people’s financial capability, including ensuring that consumers improve their financial resilience, so the Government believe that the amendments are not necessary.
On amendment 39, tabled by the hon. Member for Airdrie and Shotts (Neil Gray), the Bill already explicitly states that one of the body’s objectives is to support people in vulnerable circumstances when exercising its  functions. That was agreed after discussion in the Lords. The Government think that for the body to have specially trained advisers and guidance risks being too prescriptive on the face of the Bill. Defining “vulnerable circumstances” could narrow the body’s remit and prevent it from addressing other vulnerabilities in the future.
On amendment 40, we believe it is important that people understand the difference between information, advice and guidance, but the improvement of people’s financial capability continues to be a focus of the new body, under its money guidance function.
On amendment 41, tabled by my hon. Friend the Member for Reigate (Crispin Blunt), although the new body will provide general information and guidance to people about the benefits of saving towards a retirement income, it will not provide financial advice, but he makes a compelling case about the opportunities to use equity release products. Consumers considering equity release should seek independent financial advice, and the single financial guidance body’s role in this case will be to signpost to such advisers but not to give advice itself.
On amendment 31, tabled by the hon. Member for Harrow West (Gareth Thomas), the Government have already done a great deal to support credit unions, and I look forward to further discussions with him in Westminster Hall tomorrow, where some linked issues can be raised. I am happy to meet him and the representatives that he suggested. The new body will continue this work by providing information about credit unions’ services through its money guidance function, which means, I believe, that the amendment is unnecessary.
On amendment 42, tabled by the hon. Member for Makerfield (Yvonne Fovargue), we do not expect the standards to be too onerous on delivery partners. In setting its standards, the body and the FCA will ensure that conditions are proportionate with the benefits that they are expected to bring. In addition, the body and the FCA will consider whether the standards sit well with the FCA’s debt advice and authorisation process.
I now turn to the issues of high-cost credit, to which the hon. Member for Walthamstow (Stella Creasy) and the hon. Member for Harrow West drew the House’s attention. I think the hon. Lady knows that there is a great deal of alignment between us on some of these matters. I have written to her and I would invite her to meet me and the FCA to examine her continuing concerns around high-cost credit. There was a two-year study on credit cards, whose outcome I know she is not satisfied with. Another FCA study is to be published next month. The core function of the single financial guidance body is to deliver impartial support on money matters, and we expect its efforts to be focused on delivering to a high quality. I believe the FCA has a role to play in that and I am happy to continue to have a meaningful dialogue with the hon. Lady on that. Moreover, UK Finance already publishes statistics on the geographic distribution of mortgage lending, personal loans and small and medium-sized enterprise lending by major UK lenders. We think, therefore, that placing this issue on the face of the Bill is unnecessary.
On amendment 2, the body and the FCA have different roles and functions, and the FCA’s role is to gather information to fulfil its functions as the regulator. I am very conscious of the need to move on to the next group of amendments. I have not done justice to all the speeches on this group, but I am happy to give way.

Jack Dromey: In the spirit of being able to get on to the next group, we welcome the ban on pension cold calling. We have sought to extend that ban to all cold calling. If the Minister is prepared to have discussions at the next stages, and before the Bill concludes its passage through Parliament, we would be prepared not to oppose Government amendment 11 or to move our amendments 8 and 9.

John Glen: I am grateful to the hon. Gentleman and I acknowledge his kind words, which are reciprocated from our Front Bench. We continue to have a meaningful dialogue on the outstanding concerns that exist between us.

Frank Field: If the Minister’s optimism is misplaced on not accepting the amendments that I spoke to on behalf of the Select Committee, will he consider moving to secondary legislation?

John Glen: I thank the right hon. Gentleman for his remarks. I always listen very carefully to what he says. We have made provision for additional bans to take place very quickly, and if my optimism is misplaced, I would expect the body to act. I will continue to have a deep dialogue with the right hon. Gentleman on these matters.
Question put and agreed to.
New clause 4 accordingly read a Second time, and added to the Bill.
New Clause 9

Unsolicited direct marketing: pensions (No. 2)

‘(1) The Secretary of State may make regulations prohibiting unsolicited direct marketing relating to pensions.
(2) The regulations may—
(a) make provision about when a communication is to be, or is not to be, treated as unsolicited;
(b) make provision for exceptions to the prohibition;
(c) confer functions on the Information Commissioner and on OFCOM (including conferring a discretion);
(d) apply (with or without modifications) provisions of the data protection legislation or the Privacy and Electronic Communications (EC Directive) Regulations 2003 (S.I. 2003/2426) (including, in particular, provisions relating to enforcement).
(3) The regulations may—
(a) make different provision for different purposes;
(b) make different provision for different areas;
(c) make incidental, supplementary, consequential, transitional or saving provision.
(4) Regulations under this section are to be made by statutory instrument.
(5) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.
(6) If before the end of June in any year the Secretary of State has not made regulations under this section (whether or not in that year), the Secretary of State must—
(a) publish a statement, by the end of July in that year, explaining why regulations have not been made and setting a timetable for making the regulations, and
(b) lay the statement before each House of Parliament.
(7) In this section, “OFCOM” means the Office of Communications established by section 1 of the Office of Communications Act 2002.’—(Guy Opperman.)
This new clause inserts a new power for the Secretary of State to make regulations (subject to the affirmative procedure) banning unsolicited direct marketing relating to pensions. If the power is not exercised by June, the Secretary of State must explain to Parliament why not. This new clause would be inserted after Clause 24.
Brought up, read the First and Second time, and added to the Bill.
Clause 2

Objectives

Amendment proposed: 39,page2,line23, leave out from “accordingly” to the end of line 24 and insert—
“(da) to ensure the needs of people in vulnerable circumstances, including but not exclusively—
(i) those who suffer long-term sickness or disability,
(ii) carers,
(iii) those on low incomes, and
(iv) recipients of benefits,
are met and that resources are allocated in such a way as to allow specially trained advisers and guidance to be made available to them,”.—(Neil Gray.)
This amendment would require that specially trained advisers and guidance are made available to people in vulnerable circumstances and would provide an indicative list of what vulnerable circumstances should include.
Question put, That the amendment be made.
The House divided:
Ayes 255, Noes 293.

Question accordingly negatived.
Clause 3

Functions

Amendment made: 10,page3,line17, leave out subsection (7) and insert—
“(7) The consumer protection function is—
(a) to notify the FCA where, in the exercise of its other functions, the single financial guidance body becomes aware of practices carried out by FCA- regulated persons (within the meaning of section 139A of the Financial Services and Markets Act 2000) which it considers to be detrimental to consumers, and
(b) to consider the effect of unsolicited direct marketing on consumers of financial products and services, and, in particular—
(i) from time to time publish an assessment of whether unsolicited direct marketing is, or may be, having a detrimental effect on consumers, and
(ii) advise the Secretary of State whether to make regulations under section (Unsolicited direct marketing: other consumer financial products etc) (unsolicited direct marketing: other consumer financial products etc).”—(John Glen.)
This amendment makes changes to the consumer protection function to make it clearer exactly what it entails.
Amendment proposed: 1,page3,line39, at end insert—
“(11) In carrying out its strategic and other functions the single financial guidance body must make and publish an annual assessment of the level of different types of lending across the United Kingdom by district.
(12) The types of lending covered by the assessment in subsection (11) should include—
(a) high cost short term credit,
(b) hire purchase agreements,
(c) conditional sale agreements,
(d) open ended credit,
(e) other secured lending, and
(f) other unsecured lending.”—(Gareth Thomas.)
This amendment requires the single financial guidance body to carry out an annual assessment of the level of different types of lending in different geographical areas across the United Kingdom.
Question put, That the amendment be made.
The House divided:
Ayes 255, Noes 293.

Question accordingly negatived.
Clause 4

Cold-calling

Amendment made: 11,page3,line40, leave out clause 4.—(Guy Opperman.)
This amendment removes the clause on cold-calling (inserted by the Lords). NC3 and NC4 instead provide a power for the Secretary of State to make regulations banning unsolicited direct marketing relating to pensions and other consumer financial products and services.
Clause 7

Debt respite scheme: advice to the Secretary of State

Luciana Berger: I beg to move amendment 5, page 5, line 37, at end insert—
“(ia) how it will specifically provide protections and help to individuals in receipt of mental health crisis services, including NHS mental health crisis services;
(ib) which other mental health treatment services should be considered mental health crisis services for the purposes of this Act.”

Rosie Winterton: With this it will be convenient to discuss the following:
Amendment 3,page5,line39, at end insert—
(iiia) the application of the scheme for duration of a person’s stay in hospital or under the care of a crisis team in their local community”
This amendment will ensure that people who are staying in hospital or under the care of a crisis team in their local community will be protected by the Debt Respite Scheme once it is established.
Amendment 30,in clause 8, page6,line15, at end insert
“and must do so before 1 January 2020.”
This amendment commits the Secretary of State to implement a debt respite scheme by the end of next year.
Amendment 6,page6,line16, at end insert—
“(3A) A debt respite scheme established by regulations under this section must, specifically, provide protection and help to individuals in receipt of mental health crisis services as well as any other types of individual provided for by regulations under this section.
(3B) The regulations must define which services should be considered “mental health crisis services” for the purpose of this Act in addition to the definition in section 25 of this Act.
(3C) A debt respite scheme established by regulations under this section shall be accessible to individuals in receipt of mental health crisis services irrespective of whether those individuals have accessed debt advice.”
Government amendment 13, in clause 19, page14,line40, leave out from beginning to end of line 8 on page 15 and insert—
“(1B) As part of the application process, the trustees or managers must ensure that—
(a) the member or survivor is referred to appropriate pensions guidance, and
(b) the member or survivor is provided with an explanation of the nature and purpose of such guidance.
(1C) Before proceeding with the application, the trustees or managers must ensure that the member or survivor has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment will enable FCA rules to require trustees of a personal pension scheme who receive an application from a member to access or transfer their pension to refer them to SFGB guidance and explain its nature and purpose (or ensure that another person, such as the SFGB, does so) and will prevent them from proceeding unless the member confirms that they have received guidance or do not want it.
Amendment (a) to amendment 13, after “is referred to appropriate” insert “independent and impartial”.
Amendment (b) to amendment 13, after “has either received appropriate” insert “independent and impartial”.
Amendment (c) to amendment 13, in subsection (1C), leave out from “appropriate pensions guidance or” to end and insert
“has indicated to the provider of appropriate independent and impartial pensions guidance the desire to opt out of receiving such guidance.”
Amendments (a), (b) and (c) to amendment 13 specify on the face of the Bill that the provider of the appropriate pensions guidance should be independent and impartial, and that any desire to opt-out of guidance must be indicated to this independent and impartial guidance provider.
Government amendment 14.
Government amendment 15, page 15, line 14, at end insert—
“( ) make further provision about how, and to whom, a member or survivor may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (1C);”.
This amendment expressly envisages the rules making provision about how the opt-out (or confirmation of receipt of guidance) mentioned in the new subsection (1C) inserted by Amendment 13 must be expressed in order to be effective.
Amendment (a) to amendment 15, leave out from “received” to end and insert
“appropriate independent and impartial pensions guidance, or have indicated to the provider of this guidance that they wish to opt out, for the purposes of subsection (1C);”.
Government amendment 16.
Government amendment 17, in clause 20,page16,line10, leave out from beginning to end of line 23 and insert—
“(2) As part of the application process, the trustees or managers must ensure that—
(a) the beneficiary is referred to appropriate pensions guidance, and
(b) the beneficiary is provided with an explanation of the nature and purpose of such guidance.
(3) Before proceeding with the application, the trustees or managers must ensure that the beneficiary has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment makes equivalent changes to Clause 20(2), which relates to occupational pension schemes in Great Britain, to the changes made by Amendment 13 for personal pension schemes.
Amendment (a) to amendment 17, after “is referred to appropriate” insert “independent and impartial”.
Amendment (b) to amendment 17, after “has either received appropriate” insert “independent and impartial”.
Amendment (c) to amendment 17, in subsection (3), leave out from “appropriate pensions guidance or” to end and insert
“has indicated to the provider of appropriate independent and impartial pensions guidance the desire to opt out of receiving such guidance.”
Amendments (a), (b) and (c) to Amendment 17 specify on the face of the Bill that the provider of the appropriate pensions guidance should be independent and impartial, and that any desire to opt-out of guidance must be indicated to this independent and impartial guidance provider.
Government amendment 18.
Government amendment 19, page16,line29, at end insert—
“( ) make further provision about how, and to whom, a beneficiary may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (3);”.
This amendment is the equivalent to Amendment 15 for occupational pension schemes in Great Britain.
Amendment (a) to amendment 19, leave out from “received” to end and insert
“appropriate independent and impartial pensions guidance, or have indicated to the provider of this guidance that they wish to opt out, for the purposes of subsection (3);”.
Government amendment 20.
Government amendment 21, page17,line27, leave out from beginning to end of line 40 and insert—
“(2) As part of the application process, the trustees or managers must ensure that—
(a) the beneficiary is referred to appropriate pensions guidance, and
(b) the beneficiary is provided with an explanation of the nature and purpose of such guidance.
(3) Before proceeding with the application, the trustees or managers must ensure that the beneficiary has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment makes equivalent changes to Amendments 13 and 17 for occupational pension schemes in Northern Ireland.
Amendment (a) to amendment 21, after “is referred to appropriate” insert “independent and impartial”.
Amendment (b) to amendment 21, after “has either received appropriate” insert “independent and impartial”.
Amendment (c) to amendment 21, in subsection (3), leave out from “appropriate pensions guidance or” to “or has opted out” and insert
“has indicated to the provider of appropriate independent and impartial pensions guidance the desire to opt out”.
Government amendment 22.
Government amendment 23, page17,line46, at end insert—
“( ) make further provision about how, and to whom, a beneficiary may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (3);”.
This amendment is the equivalent to Amendments 15 and 19 for occupational pension schemes in Northern Ireland.
Amendment (a) to amendment 23, leave out from “received” to end and insert
“appropriate independent and impartial pensions guidance, or have indicated to the provider of this guidance that they wish to opt out, for the purposes of subsection (3);”.
Government amendment 24.
Government motion to transfer clause 22.
Amendment 7,in clause 25, page21,line9, at end insert—
“‘NHS Mental health crisis services’ means services provided by NHS England, NHS Wales, or Health and Social Care in Northern Ireland in order to treat acute crises in mental health, whether arising from either acute or chronic mental health conditions.”
Amendment 37,in schedule 1, page38,line4, at end insert—
“3A (1) The term of office of a person appointed as chair under paragraph 2(1)(a) must not begin before—
(a) the person has, in connection with the appointment, appeared before the Work and Pensions Committee of the House of Commons, or
(b) (if earlier) the end of the period of 3 months beginning with the day on which the appointment is made.
(2) Sub-paragraph (1) does not apply if the person is appointed as chair on an acting basis, pending a further appointment being made.
(3) The reference to the Work and Pensions Committee of the House of Commons—
(a) if the name of that Committee is changed, is a reference to that Committee by its new name, and
(b) if the functions of that Committee (or substantially corresponding functions) become functions of a different Committee of the House of Commons, is to be treated as a reference to the Committee by which the functions are exercisable.
(4) Any question arising under sub-paragraph (3) is to be determined by the Speaker of the House of Commons.”
This amendment would require the chair of the single financial guidance body to attend a pre-appointment hearing with the Work and Pensions Committee of the House of Commons before starting their appointment. If no such hearing is held within three months, the appointment can also begin.
Amendment 38,page38,line41, at end insert:
“6A (1) The term of office of a person appointed as chief executive under paragraph 6(1)(a) must not begin before—
(a) the person has, in connection with the appointment, appeared before the Work and Pensions Committee of the House of Commons, or
(b) (if earlier) the end of the period of 3 months beginning with the day on which the appointment is made.
(2) Sub-paragraph (1) does not apply if the person is appointed as chief executive on an acting basis, pending a further appointment being made.
(3) The reference to the Work and Pensions Committee of the House of Commons—
(a) if the name of that Committee is changed, is a reference to that Committee by its new name, and
(b) if the functions of that Committee (or substantially corresponding functions) become functions of a different Committee of the House of Commons, is to be treated as a reference to the Committee by which the functions are exercisable.
(4) Any question arising under sub-paragraph (3) is to be determined by the Speaker of the House of Commons.”
This amendment would require the chief executive of the single financial guidance body to attend a pre-appointment hearing with the Work and Pensions Committee of the House of Commons before starting their appointment. If no such hearing is held within three months, the appointment can also begin.

Luciana Berger: I shall speak to amendments 5, 6 and 7. I am incredibly grateful to colleagues on both sides of the House for the constructive negotiations and discussions  that have taken place to enable this group of amendments be discussed on the Floor of the House this evening. Their purpose is to extend the debt respite scheme set out in clauses 7 and 8 to people in receipt of NHS mental health crisis services. I am incredibly grateful to the large number of MPs—81, in fact—on both sides of the House who are supporting the amendments. It has also been a real privilege to work with the Money and Mental Health Policy Institute, together with colleagues from all parties, to put the amendments together.
Last year’s Conservative party manifesto contained a commitment to introduce a breathing space. The Government have since brought forward this Bill and launched a consultation into how a breathing space initiative would work in practice. This included proposals for a possible trigger point for accessing support, with the initial suggestion that a breathing space should be available only to a person seeking regulated debt advice. I very much welcome the spirit of the Government’s breathing space initiative, but I am concerned that it does little to protect the thousands of people in mental health crisis who are too unwell to physically go and seek such debt advice or to pick up the phone to make that call.
According to research by the Money and Mental Health Policy Institute, up to 23,000 people in England alone struggled with problem debt while they were hospitalised as a result of their mental health last year. Those people are likely to be receiving calls, texts and letters from their banks, local authorities and other creditors at a time of acute distress, and they are at risk of falling into further financial difficulty as a result of increased fees and charges—[Interruption.]

Rosie Winterton: Order. Some hon. Members are leaving the Chamber, and there is quite a lot of chatter. It would be good to be able to listen to the hon. Member for Liverpool, Wavertree (Luciana Berger).

Luciana Berger: I am grateful to you, Madam Deputy Speaker.
I am concerned about the charges that those people will face, and about the drop in their income from the loss of wages and benefits that people could experience as a result of being in in-patient care or crisis care in the community. Thousands more in the devolved nations, and those who are receiving mental health crisis support in the community, will be in a similar position. The additional anxiety and stress that those people experience as a result of those financial pressures not only threaten to undermine their recovery but make it much less likely that they will be able to repay their debts. The requirement for people in that situation to seek advice before they can benefit from a breathing space creates a barrier, and that barrier must be removed if the new scheme is to fulfil its purpose of protecting the most vulnerable customers.
Amendment 5 represents the first step towards rectifying this issue. It ensures that when the Secretary of State seeks advice from the new single financial guidance body on the establishment of a debt respite scheme, it will include advice on specifically how the scheme will protect recipients of mental health crisis services, and information on which services should be considered to be mental health crisis services. We propose that this  should include psychiatric in-patient facilities and community crisis teams. Amendment 6 takes this further by ensuring that the regulations to establish the debt respite scheme specifically provide protection and help to individuals in receipt of mental health crisis services, irrespective of whether those individuals have formally accessed debt advice. Amendment 7 would provide the baseline definition of an NHS mental health crisis service.
Targeting these interventions towards people with mental health problems will have far-reaching positive consequences. People experiencing mental health problems are significantly more likely to be in financial difficulty than the rest of the population, and half the people in problem debt are also experiencing mental ill health. The number of people receiving NHS crisis care services is also likely to be relatively small, and a high proportion—at least a quarter—are likely to be in financial difficulty. Furthermore, people experiencing a mental health crisis are likely to experience problems with their cognitive and psychological functioning as a direct consequence of their illness and are therefore highly unlikely to be able to seek debt advice and access breathing space through regulated debt advice.
How will the system work in practice? We suggest that a person entering the care of a psychiatric in-patient facility or crisis team in the community would be supported to access breathing space if appropriate. That could take the form of a certificate or a stamped-and-dated letter confirming that the service user is in receipt of mental health support during a crisis and should have breathing space applied. Many clinical mental health professionals are currently fighting fires before they can help their patients with their mental health. They are writing to creditors, calling bailiffs and completing reams of financial paperwork, and the changes that I am proposing would simplify things for those professionals, allowing them to focus on their day job. It would also reduce demand on mental health services, as research shows that people who are not in problem debt are much more likely to recovery more quickly and less likely to experience mental health problems in the future.
It is important to acknowledge that the proposed changes would not apply in Scotland, which already has a debt arrangement scheme that would require separate legislation to amend. However, we hope that the successful implementation of our proposals could provide the case for similar reforms in Scotland.

John Glen: In the interests of time and to allow others to speak, I just wanted to confirm that the Government recognise the motives and the wide degree of support behind the proposals and the particular issues for people experiencing a mental health crisis. We will commit to ensuring that people receiving NHS treatment for a mental health crisis, either at a psychiatric in-patient setting or in the community, will be provided with an alternative mechanism to access the breathing space scheme. We will see that that is developed concurrently with the main breathing space scheme.

Luciana Berger: I am incredibly grateful to the Minister. What he has just shared with the House has been missing until now and will make a tangible difference to at least 23,000 people a year. I am grateful for the commitment that he has made. I was going to say in conclusion that amendments 5, 6 and 7 would prevent  tens of thousands of people experiencing a mental health crisis from missing out on the protections that breathing space has to offer, which I welcome, because they are too ill to seek debt advice, so I again welcome what the Minister said, because it is critical that that most vulnerable group is not ignored.
Yesterday, the hon. Member for Plymouth, Moor View (Johnny Mercer), Martin Lewis of Money Saving Expert and I joined two people with lived experience, Lee and Susan, to hand in a petition of over 10,000 people who support the campaign. This is a truly cross-party effort, and the right hon. Member for North Norfolk (Norman Lamb) and I have campaigned long and hard. Mental health does not discriminate, and one day one of us in this Chamber could need to access a scheme such as breathing space. It could make a difference for any one of us. I am grateful that the Government have acknowledged the need to ensure that the scheme reaches everyone who needs it, particularly the most vulnerable, and tackles and addresses the impacts of mental health and debt, and I again welcome what the Minister has committed to this afternoon.

John Glen: Being mindful of the need to allow others to speak, I rise to discuss Government amendments 13 to 24. Clauses 19 and 20, which were added by the Government in Committee, aim to build on the Work and Pensions Committee’s proposals by putting them into a workable legal framework, ensuring mirroring provisions for UK occupational pension schemes. Discussions with stakeholders and Members of both Houses have informed amendments 13 to 24. If amended, clauses 19 and 20 would place new duties on managers and trustees of all defined contribution pension schemes when an individual seeks to access or transfer their pension pot.

Frank Field: We may not get a chance to discuss the amendments supported by the Work and Pensions Committee, so will the Minister give the same undertaking that he will introduce secondary legislation if our worries prove valid?

John Glen: The spirit that has run through the House during the passage of the Bill necessitates continued dialogue, and I can certainly give the right hon. Gentleman that undertaking.
I make it clear that when an individual seeks to access or transfer their pension pot, the duties will ensure that they are referred to Pension Wise guidance and that they receive an explanation of the nature and purpose of that guidance. Before proceeding with an application, subject to any exceptions, schemes must ensure that individuals have either received Pension Wise guidance or have opted out. Rules and regulations can specify how and to whom an individual must confirm that they are opting out, which allows for the opt-out process to be separated from schemes. Rules and regulations will set out the detail of the opt-out process, based on evidence of what helps people take up Pension Wise guidance.
These Government amendments lay the foundation for an effective final nudge towards guidance and will allow us to test what works best before implementation  and to update the approach in future. They strike the right balance with what is set out in primary legislation, with rules and regulations providing suitable flexibility.
In the interests of time, and to be fair to everyone else, I will now sit down.

Norman Lamb: It has been good to join the hon. Members for Liverpool, Wavertree (Luciana Berger) and for Plymouth, Moor View (Johnny Mercer), and many others, in tabling our amendments. I very much welcome the Minister’s response.
People often get into a vicious circle, with mental ill health leading them into debt because they neglect vital things and the pressure of those debts intensifying their mental ill health. Kenny Johnston, an inspiring man who set up the charity Clasp and who walked out of darkness to build solidarity for people experiencing mental ill health and suicidal ideation, went through eight years of battle with a bank on mortgage arrears that were started by mental ill health, resulting in two suicide attempts—there was constant pressure on him over that eight-year period. This measure will make a difference. It will help, and it is good the Government have been prepared to listen.
It is important to understand that this is not a panacea. I encourage the Minister also to recognise that there are very many people beyond the scope of clauses 19 and 20, such as people in in-patient care and people supported in the community, who are still experiencing mental ill health and who may end up at risk of suicide because of debt. It is important to get the message out and to establish proper processes in companies, particularly financial services companies, to treat people with mental ill health in an appropriate way in order to protect vulnerable citizens.
Legislation is already in place. The Equality Act 2010 contains a duty to consider reasonable adjustments for people who suffer from a disability, which can include mental ill health, and it is important that we spread best practice much further. I welcome the measure, but it is a start and we need to do much more to protect people’s lives.

George Freeman: Given the shortness of time, I will be brief. I thank the Minister and congratulate him on providing the House with what we were looking for this afternoon. I congratulate the hon. Member for Liverpool, Wavertree (Luciana Berger), my hon. Friend the Member for Plymouth, Moor View (Johnny Mercer), the right hon. Member for North Norfolk (Norman Lamb), the Breathing Space campaign and the 80-odd colleagues on both sides of the House who have supported the proposal.
I thank the Minister and the Government for signalling what many people in the House and across the country hugely welcome: an appetite for cross-party working in pursuit of looking after the most vulnerable in society, in the spirit of the Prime Minister’s mission when she arrived in No. 10 two years ago. This will send a signal that we are serious.
Secondly, I echo the comments made by my neighbour, the right hon. Member for North Norfolk (Norman Lamb), about the importance of understanding the vicious cycle of mental health and debt, and the way in which the two are so often implicated here. Recent figures from ComRes have shown that 56% of people in  work say that payday struggles are their biggest anxiety. Often that anxiety can lead to further complications in terms of depression, which can lead to mental health problems, which in turn can undermine their ability to earn and work. That often leads into a cycle that makes both the indebtedness and the mental health suffering worse, as I know from my own experience. Sixty years ago, my father won the Grand National and 10 years later he suffered a life collapse from a combination of indebtedness, bankruptcy, mental health issues and head injuries, which in those days were not well treated. It is a sign of how far we have come as a society and as a politics that we now talk about these issues so much more openly and we offer so much more help.
I shall close with my third point, which relates to the importance of that taboo. So many people in our society still suffer in silence from debt, which knows no boundaries and is no respecter of class, political affiliation or geography. People who may appear at ease and prosperous—and often those who appear most that way—are struggling in misery behind the scenes and compounding that misery through their inability to feel confident enough to talk about it. That is why, along with the co-chair of the all-party group on inclusive growth, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), we are working on a small campaign this summer with StepChange, the Money Advice Service, the Financial Conduct Authority and Martin Lewis called “Share not Shame” to encourage people to talk more openly about their indebtedness issues and to seek the help that is available. Many people in this country are paying far too much for debt that could be provided at a minimum—at a fraction of the price—and their debts could be rescheduled in a way that takes the pressure and shame from them. I welcome warmly the undertaking the Minister has given today and congratulate those Members who have led the campaign on this, which will signal across the country that this Parliament is taking their interests very seriously.

Yvonne Fovargue: I rise to speak to my amendment 30, which would improve the timeframe for the breathing space, ensuring its introduction by the end of 2019. That would provide greater certainty, because the current timeframe centres on the establishment of the SFGB, which is potentially moveable. I have proposed a realistic target, allowing sufficient time for the necessary preparation work. I am assured of that by the debt advice providers themselves; they say it gives enough time to plan and develop the new systems to deliver the new protections to all.
Let us not forget that debt often pushes people into a mental health crisis and that debt and depression necessitate people visiting the doctors’ surgery. They are suffering depression, but it is not that; it is the debts that are depressing them. The breathing space and statutory debt repayment plans, properly set up, will give people time and space to get debt advice, stabilise their finances through periods of temporary difficulty and put in place a long-term sustainable solution to their debts. That is not just of benefit to the individual; it benefits the creditors as well, because they know they will be getting their money back, in a fair way, over a fair period of time.
I hope that the Minister will also confirm some details of how the breathing space scheme will work. As I have said on a number of occasions, it is essential that  the length of time involved is sufficient to ensure that people are not put back into the harmful uncertainty of unmanageable debt before they have that long-term plan in place. Six weeks has been mentioned, and such a period may help some people, but I have said many times that three months is probably more realistic. I have mentioned how long it takes to get people to come in and deal with the debts, with the need to open carrier bags full of envelopes that people have not had the courage to open. If we are going to start with six weeks, provision must be made for extensions to be made to that; it cannot just finish at six weeks, as it often takes longer than that to get an appointment.
I would like to see this scheme cover all relevant debts, including benefit debts, council tax debts and debts owed to central or local government. If creditors are excluded, they will be able to put the unhelpful pressure on the debtors, which will reduce the scheme’s viability and effectiveness. This has to stop creditors across the board making unaffordable repayment demands. For example, claimants on universal credit can have 40% of their benefit withheld to pay off third-party creditors, with another 40% going on paying back benefit advances—that is 80% of the money. That leaves them with 20% of what is considered the minimum amount required to live on, and that is simply unaffordable.
There is widespread unfair pressure from Government creditors. As StepChange says, bailiffs are often the first port of call rather than a last resort. Clients rate the DWP, HMRC and councils far worse than other creditors—far worse than payday lenders—for treating them unfairly. The Government should adhere to best practice, and I hope that the Minister will agree that it is in all our interests to ensure that no vulnerable people are put into a position where they are unable to pay off their debts.

Johnny Mercer: I rise to speak in support of amendment 5, which is in my name and those of the hon. Members for Liverpool, Wavertree (Luciana Berger), and for North Norfolk (Norman Lamb), as well as many others across the House.
We in this place often talk a very good game when it comes to mental health, and serious progress has been made in taking the agenda forward over the last few years thanks to colleagues from across the House. When it comes to parity of physical and mental health, however, small details in policy matter. The amendment concerns one such detail, and I am delighted by what the Minister has said today about bringing that into reality for some of our most vulnerable constituents. It was a manifesto commitment of the Government to introduce a breathing space scheme, whereby people who suffer from problem debt are given a fixed period without fees, charges, interest or collection. The consultation is out at the moment, and I support the proposal very much, but there is a gap in provision for those who suffer from mental health crises—those who are too unwell either to manage their finances alone or seek debt advice, and so would not be able to access this scheme.
As we have heard, last year that situation affected up to 23,000 of our most vulnerable constituents, who were hospitalised for poor mental health while struggling with debt. That does not account for those who were in a similar position while receiving mental health crisis support in the community. The link between debt and  poor mental health is indisputable; it is a marriage made in hell. I pay tribute to the work of Martin Lewis in bringing together the Money and Mental Health Policy Institute, which has shone a torch on the relationship between debt and mental health. That relationship is often hidden away in some of the darker recesses of our communities, but it makes some of our most vulnerable constituents’ lives hell.
Tens of thousands of people in this country are trapped in a spiral of escalating debts and worsening mental health. Some receive court summons while they are in hospital. I know somebody who faced demands on their doorstep the day they were released following their recovery from an illness. Some people have missed bill payments while hospitalised for mental health conditions, and escalating fees and charges have led some to attempt suicide directly after contact from bailiffs.
The ask of this amendment is very clear: for the Minister to look at extending the current breathing space scheme to apply to anyone who accesses psychiatric in-patient care. We must commit ourselves ever harder to parity of esteem, as I have said. For those who have a short period of acute mental illness—who suffer panic attacks and cannot open the post, call the bank or even think coherently—going to a debt counsellor to call a halt to things is just impossible. The commitment that we seek today, and that we have got from the Minister, is important because it means that people can look to those in NHS crisis teams for advice and space in the breathing space scheme.
I thank the Minister for his willingness to listen to our concerns. The campaign has been a good one. It has involved all Members of this House and shown what can happen when those from all parts of the House work together. I come back to what I said at the beginning. We often talk a very good game—I was delighted that parity of mental health and physical health was made a manifesto commitment in 2015—but sometimes big words have to be matched by calibrated and careful actions. This is one such area, and I am delighted that the Minister has decided that he is going to work on it. I look forward to working with him and the policy institute to make that a reality for tens of thousands of people up and down the country.

Luciana Berger: I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 18

Disclosure of information

Amendments made: 12,page14,line17, after “where” insert “—
(i) the disclosure is for the purpose of enabling or facilitating the exercise of the consumer protection function, or
(ii) ”
This amendment is consequential upon Amendment 10, which makes changes to the consumer protection function, including requiring the SFGB to pass information to the FCA in certain circumstances. This amendment ensures that disclosure of information in these circumstances is protected by subsection (7) of Clause 18.
Amendment 43,page14,line26, leave out “Data Protection Act 1998” and insert “data protection legislation”—(John Glen.)
This amendment changes the reference to the Data Protection Act 1998 to a reference to the “data protection legislation” (as defined in Clause 25 as amended by Amendment 44) to reflect the changes to data protection legislation that are to be made by the Data Protection Bill.
Clause 19

Personal pension schemes: requirements to recommend guidance etc

Amendments made: 13,page14,line40, leave out from beginning to end of line 8 on page 15 and insert—
‘(1B) As part of the application process, the trustees or managers must ensure that—
(a) the member or survivor is referred to appropriate pensions guidance, and
(b) the member or survivor is provided with an explanation of the nature and purpose of such guidance.
(1C) Before proceeding with the application, the trustees or managers must ensure that the member or survivor has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment will enable FCA rules to require trustees of a personal pension scheme who receive an application from a member to access or transfer their pension to refer them to SFGB guidance and explain its nature and purpose (or ensure that another person, such as the SFGB, does so) and will prevent them from proceeding unless the member confirms that they have received guidance or do not want it.
Amendment 14,page15,line10, leave out from “guidance” to end of line 11.
This amendment (and Amendment 13) removes references to independent financial advice from Clause 19, so that it refers only to pensions guidance given by the SFGB in pursuance of Clause 5 of the Bill.
Amendment 15,page15,line14, at end insert—
“() make further provision about how, and to whom, a member or survivor may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (1C);”
This amendment expressly envisages the rules making provision about how the opt-out (or confirmation of receipt of guidance) mentioned in the new subsection (1C) inserted by Amendment 13 must be expressed in order to be effective.
Amendment 16,page15, leave out line 17 and insert—
“communication that is made for the purposes of complying with the duty in subsection (1C)”. —(John Glen.)
This amendment is consequential on the changes to the duties on trustees made by Amendment 13.
Clause 20

Occupational pension schemes: requirements to recommend guidance etc

Amendments made: 17,page16,line10, leave out from beginning to end of line 23 and insert—
‘(2) As part of the application process, the trustees or managers must ensure that—
(a) the beneficiary is referred to appropriate pensions guidance, and
(b) the beneficiary is provided with an explanation of the nature and purpose of such guidance.
(3) Before proceeding with the application, the trustees or managers must ensure that the beneficiary has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment makes equivalent changes to Clause 20(2), which relates to occupational pension schemes in Great Britain, to the changes made by Amendment 13 for personal pension schemes.
Amendment 18,page16,line25, leave out from “guidance” to end of line 26.
This amendment is the equivalent to Amendment 14 for occupational pension schemes in Great Britain.
Amendment 19,page16,line29, at end insert—
“() make further provision about how, and to whom, a beneficiary may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (3);”
This amendment is the equivalent to Amendment 15 for occupational pension schemes in Great Britain.
Amendment 20,page16,line31, leave out from second “a” to end of line 32 and insert “communication that is made for the purposes of complying with the duty in subsection (3)”.
This amendment is the equivalent to Amendment 16 for occupational pension schemes in Great Britain.
Amendment 21,page17,line27, leave out from beginning to end of line 40 and insert—
‘(2) As part of the application process, the trustees or managers must ensure that—
(a) the beneficiary is referred to appropriate pensions guidance, and
(b) the beneficiary is provided with an explanation of the nature and purpose of such guidance.
(3) Before proceeding with the application, the trustees or managers must ensure that the beneficiary has either received appropriate pensions guidance or has opted out of receiving such guidance.”
This amendment makes equivalent changes to Amendments 13 and 17 for occupational pension schemes in Northern Ireland.
Amendment 22,page17,line42, leave out from “guidance” to end of line 43.
This amendment is the equivalent to Amendments 14 and 18 for occupational pension schemes in Northern Ireland.
Amendment 23,page17,line46, at end insert—
“() make further provision about how, and to whom, a beneficiary may indicate that they have received or opted out of receiving appropriate pensions guidance for the purposes of subsection (3);”
This amendment is the equivalent to Amendments 15 and 19 for occupational pension schemes in Northern Ireland.
Amendment 24,page18,line2, leave out from second “a” to end of line 3 and insert—
“communication that is made for the purposes of complying with the duty in subsection (3)”. —(John Glen.)
This amendment is the equivalent to Amendments 16 and 20 for occupational pension schemes in Northern Ireland.
Ordered,
That Clause 22 be transferred to the beginning of line 1 on page 21.—(John Glen.)
This is a drafting change to reorder some of the existing clauses in the Bill to provide a more logical order following the insertion of NC3 and NC4.
Clause 25

Interpretation of Part 1

Amendments made: 25,page21,line2, at end insert—
“the ‘consumer protection function’ has the meaning given in section 3(7);”
This amendment inserts a definition of “the consumer protection function” into the interpretation clause, which will be necessary following the amendment to Clause 18 made by Amendment 12, which refers to the consumer protection function.
Amendment 44,page21,line2, at end insert—
“the ‘data protection legislation’ has the same meaning as in the Data
Protection Act 2018 (see section 3 of that Act);”
This amendment inserts a definition of the “data protection legislation” which is a term now used in Clause 18 (see Amendment 43) and the new clause inserted by NC9, to reflect the changes to be made to the law in this area by the Data Protection Bill.
Amendment 26,page21,line7, at end insert—
“‘direct marketing’ means the communication (by whatever means) of advertising or marketing material which is directed to particular individuals;” .—(John Glen.)
This amendment inserts a definition of “direct marketing” into the interpretation clause (using the definition in data protection legislation), which is a term used in the consumer protection function (see Amendment 10) and in NC3 and NC4.
Clause 36

Commencement

Amendments made: 45,page35,line6, at end insert—
“() section (Unsolicited direct marketing: pensions);”
This amendment amends the commencement clause so that the new clause on unsolicited direct marketing relating to pensions (inserted by NC9) would come into force on Royal Assent.
Amendment 46,page35,line25, after “Sections” insert—
“(Unsolicited direct marketing: other consumer financial products etc) and”.—(John Glen.)
This amendment amends the commencement clause so that the new clause on unsolicited direct marketing relating to consumer financial products other than pensions would come into force automatically two months after Royal Assent.
Schedule 4

regulation of Claims Management Services: Transfer Schemes

Amendments made: 47,page47,line17, at end insert—
“‘the data protection legislation’ has the same meaning as in the Data
Protection Act 2018 (see section 3 of that Act);”
This amendment inserts a definition of “the data protection legislation”, which is a term now used in paragraph 19 of this Schedule (as amended by Amendment 48) to reflect the changes made by the Data Protection Bill.
Amendment 48,page49,line32, leave out “Data Protection Act 1998” and insert “data protection legislation”.—(John Glen.)
This amendment changes the reference to the Data Protection Act 1998 to a reference to the “data protection legislation” to reflect the changes to data protection legislation that are to be made by the Data Protection Bill.
Title
Amendments made: 28,line2 leave out “cold-calling and”.
This amendment, together with Amendment 29, amends the long title in consequence of NC3 and NC4.
Amendment 29,line3 at end insert—
“to provide a power to make regulations prohibiting unsolicited direct marketing in relation to pensions and other consumer financial products and services;”.—(John Glen.)
See explanatory statement for amendment 28.

Rosie Winterton: I will now suspend the House briefly in order to make a decision about certification. The Division bells will be rung two minutes before the House resumes.
Sitting suspended.
On resuming—

Rosie Winterton: I can now inform the House that I have completed certification of the Bill, as required by the Standing Order. Clauses 29 and 31 of, and schedule 4 to, the Bill, as amended, relate exclusively to England and Wales and are within legislative competence. Copies of the final certificate will be made available in the Vote Office and on the parliamentary website.
Under Standing Order No. 83M, a consent motion is therefore required for the Bill to proceed. Copies of the motion are now available. Does the Minister intend to move the consent motion?

Guy Opperman: indicated assent.
The House forthwith resolved itself into the Legislative Grand Committee (England and Wales) (Standing Order No. 83M).
[Dame Rosie Winterton in the Chair]

Rosie Winterton: I remind hon. Members that, if there is a Division, only Members representing constituencies in England and Wales may vote. As the knife has fallen, there can be no debate. I call the Minister to move the consent motion.
Motion made, and Question put forthwith (Programme Order, 22 January, and Standing Order No. 83M(5)),
That the Committee consents to the following certified clauses of, and schedules to, the Financial Guidance and Claims Bill [Lords]—
Clauses and schedules certified under Standing Order No. 83L(2) as relating exclusively to England and Wales and being within devolved legislative competence
Clauses 29 and 31 of the Bill as amended in Public Bill Committee (Bill 160), and Schedule 4 to the Bill as amended on Consideration—(Guy Opperman.)
Question agreed to.
The occupant of the Chair left the Chair to report the decision of the Committee (Standing Order No. 83M(6)).
The Deputy Speaker resumed the Chair; decision reported.
Third Reading

Pete Wishart: On a point of order, Madam Deputy Speaker. I am grateful to you for all the onerous contributions that you had to make to provide certification, but what can be done to ensure that the huge numbers of English Members who wish to speak in the English Legislative Grand Committee get their opportunity to do so? This is Dave’s legacy, for goodness’ sake. English votes for  English laws was supposed to be the most important issue possible. It seems that, once again, English Members have been totally denied their opportunity. Is not this just the greatest waste of time that this House has to endure?

Rosie Winterton: That is not a point of order. If the hon. Gentleman wishes to speak on Third Reading, he is able to do so.

Esther McVey: I beg to move, That the Bill be now read the Third time.
This Bill is an important piece of legislation. When it started its journey in the other place in June last year, my noble colleague Baroness Buscombe told peers that it would create a framework that would ensure that people have access to the information and guidance they need to make the important and effective financial decisions that we all have to make at some point in our lives. It will also enable the transfer of claims management regulation from the Ministry of Justice to the Financial Conduct Authority, to ensure that there is a tougher regulatory framework and that people have access to high-quality claims handling services.

Alberto Costa: I thank my right hon. Friend for giving way so early in her speech. Does she agree that it is important that the Financial Conduct Authority and the Financial Ombudsman Service are properly equipped to take on the additional powers proposed?

Esther McVey: I do indeed. We need to have bodies that have teeth, that are able to do this and that we can have faith in. My hon. Friend makes a very good point.
The Bill has delivered on what we said it would, but it now does so much more. The inclusion of a ban on pensions cold-calling, the commitment to introduce a debt respite scheme and the ban on claims management companies cold-calling, as well as the amendment on pensions guidance, all strengthen the Bill. I welcome and appreciate the collaborative spirit that the Bill has engendered across both Houses and the hard work that officials have done. There has been a broad consensus. That is positive, and it has helped so many people in so many different ways.
In the other place, we listened carefully to the thoughtful of views of those who engaged in the debates. We appreciate, in particular, the input of Lord Stevenson, Lord McKenzie, Lord Sharkey, Baroness Drake, Baroness Kramer and others who have helped us to craft the clauses on debt respite, cold-calling, pensions guidance and consumer protection. There were some very constructive and helpful debates on other issues that helped us to ensure that the FCA will have regard to the needs of consumers when setting the single financial guidance body’s standards, to strengthen offences on impersonating the new body, to extend the claims management provisions to Scotland and—thanks to the tireless work of Baroness Meacher—to introduce an interim fee cap in respect of PPI claims. To quote Lord McKenzie on Third Reading:
“These changes have come about because, broadly, we have had a shared analysis of what the Bill could achieve”.—[Official Report, House of Lords, 21 November 2017; Vol. 787, c. 106.]
There have been many positive contributions in this House as well. We heard some excellent speeches on Second Reading from Members on both sides of the House. I remember, for example, the powerful speech by my hon. Friend the Member for Chippenham (Michelle Donelan) about debt arguably being one of the biggest challenges to social mobility and, as Conservative Members particularly support social mobility, how important it is to be able to give this financial support. I still recall the very strong contributions from the hon. Member for Makerfield (Yvonne Fovargue) on the proposed debt respite scheme and from my hon. Friend the Member for Mid Derbyshire (Mrs Latham), who recounted the hardships faced by her constituents.
We have listened to what hon. Members said in respect of pensions cold-calling and default pensions guidance. I would like to put on record again our thanks to the Work and Pensions Committee for its report highlighting some of these issues. I thank the Select Committee, peers and hon. Members in this House for the way in which all sides have worked collaboratively and constructively on these issues. We have been able to accept a number of the Committee’s recommendations. I am sure that all hon. Members will agree that, with its help, we have made huge progress in these areas. I look forward to continuing co-operation when we bring forward regulations on these matters later this year.
We have also listened to what was said in respect of cold-calling from claims management companies. In Committee, we tabled amendments to ban cold-calling in relation to claims management services unless prior consent has been given. This honours a commitment that we made in the other place. We believe that these changes—along with our commitment to keep under review, and potentially ban, other areas of unsolicited direct marketing in relation to consumer financial products —demonstrate our commitment to tackling unsolicited marketing calls. The Information Commissioner’s Office, which enforces restrictions on unsolicited electronic direct mailing, has the power to fine offenders up to £500,000. In 2017, the ICO issued 29 civil monetary penalties totalling £2.83 million.
In Committee, we also tabled amendments to the claims management clauses. We are now placing a duty on the Law Society of England and Wales to cap fees in relation to financial services claims management activity, as well as introducing a power for the Law Society of Scotland to restrict fee charges for this activity, to ensure that consumers are protected no matter which type of claims management service provider they use, whether it is regulated by the legal service regulators or by the FCA.
This Bill deals with important and fundamental issues not just to this House but to the many hundreds of thousands of people who will benefit from the services of a new single financial guidance body—particularly those who are struggling with debt.
I am pleased to be able to confirm again today for the hon. Member for Liverpool, Wavertree (Luciana Berger), the right hon. Member for North Norfolk (Norman Lamb) and my hon. Friend the Member for Plymouth, Moor View (Johnny Mercer) that the Government recognise the importance of providing a suitable mechanism to  access breathing space for people experiencing a mental health crisis. We understand that people in the midst of a mental health crisis are likely to be too unwell to access the breathing space scheme through a regulated debt advice provider. We commit to ensure that people receiving NHS treatment for a mental health crisis, in either a psychiatric in-patient setting or the community, are provided with a suitable alternative mechanism to access the breathing space scheme and benefit from the protections it will provide. That provision will be developed concurrently with the main breathing space scheme.
In respect of claims management companies, the Bill sends out a clear message that we are on the side of the public, providing a stronger framework to ensure that individuals are accountable for the actions of their businesses. While recognising that many claims management companies do good work to support people to claim compensation, we have sent a clear message that we will tackle malpractice where it exists, such as nuisance calls and the encouragement of fraudulent claims. I commend the Bill to the House.

Jack Dromey: Why does this Bill matter? It matters because of that Port Talbot shift supervisor who said he would never, ever forgive himself, having made a mistake and been conned into being sold short on his pension, with all 20 on his shift following his lead. It matters for the single mum in my constituency who had been a victim of domestic violence and had continuously to borrow to pay off her debt. As she said to me, “I borrowed to pay the debt because I borrowed to pay the debt because I borrowed to pay the debt.” It matters to Christine, who was first diagnosed with cancer in 2009 but is still feeling the financial effects today—in debt, pursued constantly for it and her bank oblivious to her condition.
The Bill will help to end scams. It will help to ensure that rogues who are exploiting in particular the vulnerable and undercutting the reputable have no place in the market in future. This is a good Bill. It was strengthened in the other place and then in Committee. It establishes the single financial guidance body, which is a strong step in the right direction.
The Bill has also seen progress today. Progress was previously made on issues of immense importance, in particular pensions cold-calling. It is deeply welcome that the Government have listened to the strong representations made across the House on breathing space and recognise the particular problems of those suffering from mental ill health. The new body will promote greater understanding and help people to plan their finances and retirement.
There is still further progress to be made. We will engage with the Government following our earlier exchanges, because of our very strong view that the time has come to stop all cold-calling for commercial purposes by claims management companies. There is very important progress yet to be made.
The Government have constructively engaged and sent some welcome signals. They have talked about the next stage of the process. The sooner we can get there, the better. I would like to thank a number of people. While there were rather robust exchanges over GKN earlier on in the Chamber, I have to praise both the Under-Secretary of State for Work and Pensions, the  hon. Member for Hexham (Guy Opperman), and the Economic Secretary to the Treasury for their helpful, constructive and collaborative approach.
I would like to thank the Work and Pensions Committee for its characteristically first-class intervention and advice, and in particular its Chair, my right hon. Friend the Member for Birkenhead (Frank Field). The Committee can take particular credit for the progress made on the ban on pensions cold-calling.
I would like to thank all colleagues in this place who tabled amendments and contributed to the various debates that took place.
I thank the Members of the other place for the contributions that they made, again across party—particularly, but not exclusively, Lords Sharkey, Altmann, McKenzie of Luton and Drake. I thank also the Commons Clerks and other staff who worked so hard with us to shape the Bill and to take it through Parliament. All those parties and organisations have contributed to the passage of the Bill with their wisdom and many topics of interest.
I thank those organisations and individuals who passed on their research or sometimes heartbreaking stories, which brought home to us the Bill’s importance. I often say that I believe we need a story to tell the stories, and we have heard so many stories—sometimes tragic ones—throughout the Bill’s passage. It is for people like them that we are all here, and I hope that the Bill will help them in the next stages, and as we move forward, making further progress, ensuring that it benefits all, but especially the most vulnerable in our society.
In conclusion, I have something to say to that steel shift supervisor who wept uncontrollably about the consequences of what he had done and the effect on others who followed his lead. We say to him and all those whose stories were told throughout the Bill’s passage that sometimes nothing can be done to put right the wrong that they suffered in the past, but in their own way, by telling their stories, making their contribution, they have helped to bring into being a very important body—the single financial guidance body—that will ensure that never, ever again are others treated as they were.

Crispin Blunt: I echo the compliments that the hon. Member for Birmingham, Erdington (Jack Dromey), the shadow Minister paid to the Work and Pensions Committee and its Chair and to the two Ministers who have done most of the legwork on the Bill. The Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham (Guy Opperman), and my hon. Friend the Economic Secretary to the Treasury have been exemplary in their handling of the Bill, as appears to be universally recognised. I would say to the shadow Minister that this is an immensely important Bill. It is very important for all the people we represent, building on the huge change that we made in giving people freedom around their pensions, and therefore there is a need to ensure that it is underpinned by proper advice and guidance.
I represent a number of financial firms in my constituency. I used to represent Legal & General, which was the biggest employer in my constituency, but it has  had the impertinence to move out of Kingswood and go elsewhere. It is one of its rivals whose interests I defend. The pension freedoms that we announced in the Budget some time ago were a major challenge to two companies in my constituency—Just Retirement and Partnership. As one of my friends who worked at one of those companies said, “We have just a slight problem now, as the Government are not mandating that everybody must buy our product as an annuity. They now have options over their future.”
Those two companies were insurgents in the financial services market. Just Retirement specialises in the issue of equity release, which I addressed in the debate on the first group of amendments, trying to ensure that there is proper access to advice on people’s property as part of their asset structure in planning for retirement. Partnership specialised in identifying groups of annuitants with a shorter life expectancy, who therefore would be able to get a greater rate of return out of their pension investment. As people who had been saving with the big boys, such as Legal & General, moved into taking their pensions, they needed proper advice and guidance about the products that were available in the market.
I listened very carefully to the exchange between the Chair of the Select Committee and the Minister around the issue of the independence and impartiality of the advice that people will have access to. This will be the test that I apply to the Bill: people who are saving with a big player such as Legal & General must not be captured, in a sense, by simply not being exercised enough to seek independent advice in order properly to understand what options are available to them, and suborned as it were into continuing with the existing provider without understanding the options available to them. That is why the independence and impartiality, and the encouragement that people will get to seek that advice, is the test that needs to be set for whether this legislation will do the job, making them savvier about their pensions and the options available to them in retirement.
These matters are incredibly important to almost everyone in the course of their lives, when they come to make the big decisions about financial provision in retirement. I will be looking at this legislation, and at the undertakings that have been given, so that if it does not deliver what we hope it will, we can revisit it and ensure that people can access advice.
The Bill builds on the huge opportunities that we have given people to spend their own money in pursuit of their own priorities, while of course ensuring that they make sensible provision for their retirement, on the basis of advice and as informed consumers. That will take them away from being comfortable simply to be prisoners of their own big provider, without understanding the options available to them. We have given people their freedom and I hope that the Bill will ensure that they can use it in an informed way. That is a huge change, and one that I warmly support.

Neil Gray: It is a pleasure to follow the hon. Member for Reigate (Crispin Blunt) and I wish to echo much of what he has said. Much of what the Bill does is try to protect consumers from some of the unintended consequences of pension freedoms. We welcome the Bill.
I want to use the few minutes available to me to echo some of the thanks that have been offered by the Minister and the shadow Minister to all those involved, including the Clerks and the House staff. I thank my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black), who served on the Public Bill Committee, and Emily Cunningham, who diligently provided support as part of the Scottish National party’s research team. I thank the Under-Secretary of State for Work and Pensions, the hon. Member for Hexham (Guy Opperman), and the Economic Secretary to the Treasury, the hon. Member for Salisbury (John Glen), for their dialogue—we got there in the end. There were some issues along the way, not least the delays in getting to this point, but we are where we are. I thank the Work and Pensions Committee and its Chair, the right hon. Member for Birkenhead (Frank Field), for their diligence in bringing issues to the fore. I also thank the stakeholders who provided expert advice and briefings throughout our deliberations.
We on the SNP Benches remain concerned about some aspects of the Bill, and we have all articulated that—the hon. Member for Reigate has just done so. We remain concerned about the opt-out from pension guidance and about cold calling. We will watch closely for the developments that the Government have promised as the Bill is signed into law.

Ruth George: I will not detain the House for long. In a long afternoon of debate on financial guidance and cold calling since the ten-minute rule Bill introduced by the hon. Member for Stirling (Stephen Kerr), we have heard how important it is that so many people receive support and proper independent financial guidance. I welcome the work that has been done on both sides of the House, by Front Benchers and Back Benchers. As a member of the Work and Pensions Committee, I am glad that we have been able to contribute to the work that has gone into the Bill. I hope that Ministers will  continue to listen to the arguments as they develop the Bill further when it returns to the other place.
We have heard in recent hours about people suffering from mental health problems. They are more vulnerable to people seeking to take their money, whether through cold calling and doorstep selling. As we have heard, mental health problems can be exacerbated by debt. I hope that the Government will consider widening the definitions of debt and of mental health crisis. I have constituents in High Peak who, unfortunately, even at a time of crisis and having attempted suicide, are unable to access mental health crisis support—in-bed support is not available, and there is even a waiting list for support in the community. I therefore hope that the Government will have as wide a definition as possible of people either receiving crisis care or on the waiting list to receive crisis care—I am sorry to say that there are waiting lists for crisis care. The definition should be extended to all debt.
Recently, I asked some parliamentary questions about the level of debt being recovered under universal credit and was sorry to hear that about 6% of current full-service claimants are paying 40% of their universal credit payments to cover third-party debts, leaving them with just 60% of a universal credit payment, which is already lower for many recipients than legacy benefits. Those people have already seen cuts and this is leaving them with even less to pay their debts.
As we heard from my hon. Friend the Member for Walthamstow (Stella Creasy), companies that provide consumer credit can be ruthless in hounding their customers and often contribute to mental health difficulties. In this era of rising household debt, we have nearly £200 million of consumer credit. Independent financial guidance and support are needed more than ever. I urge the Government to ensure that as many people as possible can access it.
Question put and agreed to.
Bill accordingly read the Third time and passed, with amendments.

MENTAL HEALTH UNITS (USE OF FORCE) BILL (MONEY)

Queen’s recommendation signified.

Jackie Doyle-Price: I beg to move,
That, for the purposes of any Act resulting from the Mental Health Units (Use of Force) Bill it is expedient to authorise the payment out of money provided by Parliament of:
(1) any expenditure incurred under or by virtue of the Act by the Secretary of State, and
(2) any increase attributable to the Act in the sums payable under any other Act out of money so provided.
The Bill seeks to reduce the inappropriate use of force against people with mental disorders in mental health units. It also seeks to increase oversight and allow greater scrutiny of the system when it goes wrong.
Like many Members, including the hon. Member for Croydon North (Mr Reed) who brought forward the Bill, I was very moved by the events that led to the untimely death of Seni Lewis. I pay tribute to the Lewis family, who have campaigned tirelessly to ensure that such a tragedy does not happen to any other family. The Bill is testimony to the commitment of the Lewis family and the hon. Gentleman to ensure that we properly hold the system to account.

Steve Reed: I congratulate the Government and the Minister on bringing forward the money resolution this evening. We have been anticipating it for a few weeks, so it is a great pleasure and slight relief to have it before the Chamber.
The resolution will allow the Committee to complete its work in the morning and take forward this important social reform, which we hope will make a big difference to the lives of some of the most vulnerable people in our country—people who are living with mental ill health and should not face extreme forms, or indeed other forms, of restraint, which can cause serious injury or even death, as we saw in the case of Seni Lewis. I thank the Minister for her commitment to seeing this through.
Question put and agreed to.

BUSINESS WITHOUT DEBATE

DELEGATED LEGISLATION

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Companies

That the draft Companies (Disclosure of Address) (Amendment) Regulations 2018, which were laid before this House on 22 February, be approved.—(Mike Freer.)
Question agreed to.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

European Union

That the draft European Union (Definition of Treaties) (Work in Fishing Convention) Order 2018, which was laid before this House on 22 February, be approved.—(Mike Freer.)
Question agreed to.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

Constitutional Law

That the draft Welsh Ministers (Transfer of Functions) (Railways) Order 2018, which was laid before this House on 28 February, be approved.—(Mike Freer.)
Question agreed to.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

Local Government

That the draft Combined Authorities (Borrowing) Regulations 2018, which were laid before this House on 12 March, be approved.—(Mike Freer.)
Question agreed to.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

Housing

That the draft Licensing of Houses in Multiple Occupation (Mandatory Conditions of Licences) (England) Regulations 2018, which were laid before this House on 15 March, be approved.—(Mike Freer.)
Question agreed to.

John Bercow: In a risky move, but with the concurrence of the House, I propose to take motions 9 and 10 together. I merely remind Members—I am sure that they are keenly conscious of the fact—that both appertain to energy.
Motion made, and Question put forthwith (Standing Order No. 118(6)),

Energy

That the draft Domestic Renewable Heat Incentive Scheme (Amendment) Regulations 2018, which were laid before this House on 7 February, be approved. That the draft Renewable Heat Incentive Scheme Regulations 2018, which were laid before this House on 19 March, be approved.—(Mike Freer.)
Question agreed to.

PETITION - ROYAL BANK OF SCOTLAND CLOSURE IN KILBIRNIE

Patricia Gibson: This petition from the residents of the North Ayrshire and Arran constituency attracted 560 signatures, which were gathered by me, dedicated Garnock valley Scottish National party activists and our SNP councillor.
The petition states:
The petition of residents of North Ayrshire & Arran,
Declares that proposed closure of the 3 branches of the publicly-owned Royal Bank of Scotland in the areas of Kilbirnie, Kilwinning & Saltcoats will have a detrimental effect on local communities and the local economy.
The petitioners therefore request that the House of Commons urges Her Majesty's Treasury, the Department for Business, Energy and Industrial Strategy and the Royal Bank of Scotland to take into account the concerns of petitioners and take whatever steps they can to halt the planned closure of these branches.
And the petitioners remain, etc.
[P002135]

PETITION - BASINGSTOKE MOTORWAY SERVICE AREAS

Maria Miller: I rise to present this petition, which, with over 3,000 signatures, clearly demonstrates the strength of opposition to proposals for two separate motorway service areas in Basingstoke, at junction 6 and at a site near Hatch Warren next to junction 7. If both were to go ahead, this would mean four service station areas within a 23-mile stretch of the M3. I would like to thank local councillors who have campaigned tirelessly in their communities to raise awareness of the issue—in particular, Councillor Terri Reid in Hatch Warren and Beggarwood and Councillor Onnalee Cubitt in Basing ward.
The proposed motorway service areas cause huge concern. Residents in Hatch Warren are worried about the potential encroachment on their residential area from a proposed new motorway flyover to access the services on the opposite side of the motorway, and Thames Water has warned of the risk of sewage flooding resulting from the proposals currently being considered for junction 6. This proposal would also cause real road safety concerns, unnecessarily creating tailbacks on the M3, which in the past have led to road traffic accidents and tragically, the loss of life.
The petition states:
The petition of residents of Basingstoke,
Declares that urgent action must be taken concerning proposals for new Motorway Service Areas at Basingstoke; further that there is no need for any additional motorway service areas given that the existing services at Fleet and Winchester are only 23 miles apart; further that the development of any new facilities will be detrimental to the environment and traffic congestion; further that they are clearly not in the best interests of Basingstoke residents; and further that the two proposals that have been made to date, one at Junction 6 and one near Junction 7 are not acceptable.
The petitioners therefore request that the House of Commons urges HM Government to ensure road safety and the avoidance of traffic congestion are given priority over any unnecessary new motorway service areas around Basingstoke; and further urges the Department for Transport to reinstate the requirement for there to be a minimum distance between motorway service areas.
And the petitioners remain, etc.
[P002139]

National Bereavement Care Pathway

Motion made, and Question proposed, That this House do now adjourn.—(Mike Freer.)

Will Quince: It is a pleasure to lead this debate this evening, and may I thank the Minister for being here to respond?
I never entered politics with the intention of becoming a baby loss awareness campaigner. As with so many in this field, the loss of a child—my son in 2014—brought about my interest and desire to bring about change. And being a Member of this House, gives every one of us the platform to make a difference. It can be a small change that affects just one of our constituents, or it can be something larger that affects everyone in the UK. I am proud that through my role in this House I have been able to play even just a small part in the development and roll-out of the national bereavement care pathway, which is something that will make a difference to tens of thousands of bereaved parents and families up and down the country.
Before I move on to the pathway itself, I want to pay tribute to you, Mr Speaker. You have been hugely supportive of our baby loss awareness campaigning efforts in this place, and I know I speak for all members of the all-party group on baby loss when I say a heart- felt thank you.
Launched last year at 11 sites across England, the pathway has been developed by a number of baby loss charities, royal colleges and professional organisations with the support of the Department of Health and Social Care and the APPG. It is designed to improve the quality of bereavement care experienced by parents and families at all stages of pregnancy and baby loss up to 12 months. The pathway provides a practical framework for all those healthcare and other professionals involved and has been informed and led by the views of bereaved parents at every stage of its development. Parents have stressed the importance of sensitive and consistent care, of making informed choices, of privacy, of not having to repeat their stories to different members of staff and of having opportunities to create memories and spend time with their babies. As one bereaved parent put it:
“Parents don’t need protecting; they just need the chance to be parents, provide their child with dignity and create memories.”
Each year in the UK, thousands of parents and wider families sadly go through the devastating experience of losing a child. While we cannot take away that devastation and grief, good care can make a devastating experience feel more manageable, while poor-quality or insensitively delivered care can compound and exacerbate pain.

Jim Shannon: I congratulate the hon. Gentleman on his hard work in this area—we are all greatly moved—and he is right to thank you, Mr Speaker, for all you have done. The combination of both your efforts is highly regarded in the House. Does the hon. Gentleman agree that, with three babies a week being stillborn or dying in the first four weeks of life in a nation as small as Northern Ireland, those suffering this heartbreak must be supported, which is why the care pathway is essential?

Will Quince: My hon. Friend is absolutely right, and I thank him for the support he has given to the APPG since its formation. He is right that just one stillbirth or neonatal death is one too many, and while we should rightly campaign for reductions—we have ambitious targets in that regard—it is absolutely right to ensure that even if we hit those targets, as I will come to later, we make sure we have world-class bereavement care for those parents and families who sadly suffer the loss of a child. Through the pathway, we can work to ensure that they receive the best-quality bereavement care that the NHS can deliver.
Bereavement care has been a priority for the APPG for two reasons. First, there is sadly an inconsistency in the quality and standard of bereavement care across the country. Every parent and family who suffer the loss of a child should receive the same high-quality bereavement care no matter where they live, yet that is not the case at the moment. A report from Sands in 2016 found that only 46% of trusts with maternity units provided mandatory bereavement care training for maternity unit staff. Further, of those who did provide the training, 86% provided their staff with just one hour or less of training each year.
A separate report by Bliss in 2015 on neonatal units found that 41% of units had no access to trained mental health workers and that while some units had dedicated bereavement facilities, many relied on normal accommodation or quiet rooms. That is very important. In the case of 50% of bereaved mothers, care after their baby had died was considered poor enough to have affected their psychosocial wellbeing and any plans that they might have for a future baby. We should therefore be ensuring that parents who suffer the loss of a child receive the best possible care wherever they are in the country, and that is exactly what the bereavement care pathway does.
The second reason, however, is that 15 babies sadly die every single day before, during, or shortly after birth. This takes me to the point made by the hon. Member for Strangford (Jim Shannon). Even given the Government’s ambitious target of a 50% reduction in stillbirth and infant death by 2025, there will still be tens of thousands of stillbirths and neonatal deaths, and tens of thousands of parents, grandparents and wider family members will still go through the tragedy of baby loss. While it is right that we work to reduce baby loss rates by, for instance, tackling smoking among pregnant women, we also need to ensure that there is high quality-care throughout the NHS for the parents who do, sadly, lose a child.
Last month, I had the opportunity to visit one of the first pathway pilot sites, established by Chelsea and Westminster and West Middlesex University hospitals, to see it in action. It was great to chat with staff and discuss what challenges they faced in implementing the pathway, and what benefits they had found for parents. My experience during that visit has been backed up by the recent early evaluation of the first phase of the pathway. Feedback from the pilot sites found that it had helped to raise the profile of bereavement care in hospitals—a vital change, now that that will be assessed as part of inspections by the Care Quality Commission—and that it had also encouraged different teams in hospitals and departments to work more closely together.
That independent report showed not only the need for the programme, but its obvious impact. For example, where bereavement midwives are in post, they are making  a significant and positive difference in their trusts. However, more work is clearly needed to ensure that good practice is shared across hospital trusts, so that all staff who come into contact with bereaved parents are equipped and helped to deliver the high-quality care that we all want to see. The findings show the huge potential for improving bereavement care in pregnancy and baby loss, something that I, and the all-party parliamentary group, will continue to proudly support. It has also been useful for healthcare professionals to suggest ways in which the pathway can be refined, and, in particular, how it can be ensured that the documents and guidance that are issued are more practical in terms of implementation.
Last Monday, our APPG hosted a reception to mark the launch of the second wave of pathway sites. A further 21 trusts are now piloting the pathway, providing sites where bereaved parents will be able to experience better care.

Patricia Gibson: I congratulate the hon. Gentleman on securing the debate and on all the work that he has done in this field, including his work in the all-party group. Earlier, he gave the chilling statistic that 15 babies die each day in the United Kingdom. Of course we all know that the loss of a baby—the death of a child—is the last taboo. The irony is that, although the rolling out of bereavement pathway sites throughout the UK is welcome and much needed, it is because baby loss is so hard to discuss that it has taken us so long to reach this point.

Will Quince: The hon. Lady—and I will call her my hon. Friend—has made a very valid point, and I thank her for all her contributions to the formation and the continuing work of the APPG. She is right: there is a taboo surrounding baby loss, and we must break it. I remember the first debate about it that we held here, in November 2015, and the floods of e-mails and messages that we received from parents out there who were saying, “Thank heavens, someone is now talking about baby loss.” They had felt so enclosed, and unable to talk about it, to the extent that people would cross the street to avoid having to have that awkward conversation.
That is exactly why the pathway is so important. Although NHS professionals up and down our country are caring and compassionate to their very core, not everyone has experienced this kind of grief. It is important that the pathway is parent-led, because that enables parents to share the experience of what they went through, how they were feeling, and how things could possibly improve in the future. I encourage the hon. Lady to continue her work in the APPG and continue to participate in debates like this, because that shows the country as a whole that we are willing, ready and able to talk about baby loss, and will not stop talking about it until as have addressed some of these big issues.

Jim Shannon: The hon. Gentleman is being gracious in giving way—I thank him for that. One of my staff members had two miscarriages, and the loss for her was immense. What sustained her through that time of grief, which he knows about himself, was the support of family, friends and all of us associated with her, but probably more than anything else her faith and her Christian beliefs. Does he agree that it is critical that that is part of the pathway?

Will Quince: I thank the hon. Gentleman for his further intervention. He raises a good point, because hospital chaplains provide amazing support for those who have gone through this horrific experience. Whether someone is of a religion or of none, there is an important role for the calm, comforting voice and listening ear of a chaplain, who can sit with them and give them the time that NHS professionals are not always able to give in a busy, hustling and bustling maternity or neonatal department.

Victoria Prentis: My hon. Friend is being generous in giving way. Does he agree that the baby loss services that we have organised, particularly last year, have helped many couples across the UK come to terms with their grief? We had a fantastic one at St Mary’s church in Banbury and a fabulous one downstairs in the Crypt here. Whether or not people are of faith, those services enable them to demonstrate their grief in a public place, which is very helpful.

Will Quince: I thank my hon. Friend for that intervention and for the considerable work that she has put into both the formation and the ongoing work of the all-party group. She makes a really good point. Those services are not always religious, although most of them tend to be in some way, shape or form, and they are hugely important and comforting to families. I know that she has organised several, and various charities organise them too. They are about not just the religious element but people being able to come together and pay their respects to the children they have lost. They bring about a community and show people that they are not alone and that there are others who have gone through the same or very similar experiences. Long-lasting friendships often flow from them. I remember a service that I attended with my wife—I think it was the year after we lost our son. There was a lady there in her 80s who still came to the service every year to remember the child she lost in her late teens. That shows that the experience stays with people forever, and that these services are really important.
With the evidence showing that the pathway is making a really big difference in improving the quality of bereavement care in the hospital trusts in which it is being piloted, the aim is to roll it out across the country in October. As I said at the beginning, 11 sites launched last October and a further 21 last week, and a nationwide launch in October is very much the ambition. Sands established the project on behalf of the core pathway group, entirely thanks to £50,000 of funding from the Department of Health and Social Care. I am extremely pleased to see my hon. Friend the Member for Ludlow (Mr Dunne), the former Care Quality Minister, in his place, because he did so much with the Secretary of State to help secure that funding.

Philip Dunne: I hesitate to rise after that generous tribute, but may I say that I am absolutely convinced that without the work of my hon. Friend and his colleagues in the all-party group, we in the Department would not have given this issue the prominence that it has achieved under their leadership? In particular, I wish to mention the role that Sands has played in driving this agenda forward. I pay tribute to that organisation and all the bereaved parents that it represents, and I congratulate my hon. Friend on securing yet another debate on this topic.

Will Quince: I thank my hon. Friend for his kind words. He makes a good point about the charities involved. One of the great strengths of the all-party group is that we have been able to bring together about 40 baby loss charities, and that number grows at every meeting. This is one reason why we have been so successful. Some of the charities are big, including Sands, Bliss and the Lullaby Trust, while others are very small, including those that make teddy bears or knit little items of clothing for their local neonatal units. We are bringing all those charities together with one common purpose: to reduce baby loss and ensure that we have world-class bereavement care. This is what has genuinely made the difference. When politicians work with the charitable sector, the Government, bereaved parents, clinicians and medical professionals, that is when we can really make a difference, and I genuinely believe that this is a prime example of that happening.
This is also a good juncture to pass on my sincere thanks to the Secretary of State for Health and Social Care. He could not have been more supportive of the formation of the all-party group or of our work, and I have always felt that, with him, we were pushing at an open door at every turn. I know that that feeling will be echoed by other members of the group. Every time we have tried to move the agenda forward, the Secretary of State has been willing to listen and to act, and I thank him for that.
We are also most grateful for the Department’s financial support, in the form of £50,000, to help to launch the national bereavement care pathway. However—this is the big “however”—that funding was exhausted last year. Since then, Sands has continued to support the project, covering the costs of staff, partnership, documentation production, website development and all the engagement activity that supports it. To ensure that the pathway is embedded across England by 2020, in line with commitments on improved patient safety, maternity services and bereavement care, the project has to be suitably resourced. Sands has approached the Department of Health and Social Care asking for support to cover the core costs of the pathway. It has formally requested further funding for the current financial year and the next.
There is overwhelming political, parental and professional support for the pathway. I do not want to put the Minister on the spot, but I ask the Government to commit to provide Sands with additional funding for the roll-out of the pathway, which is so important. This will mirror the commitment given by the Scottish Government, who are funding the roll-out in Scotland. More widely, the Department of Health and Social Care should look to put in place the resources needed to ensure that staff are given the training and facilities that they need to make this a success and to give bereaved parents the best possible care. The loss of a child is something that affects tens of thousands of parents every year. The Government can rightly be proud of the progress made, the ambitious targets set and the plans put in place to reduce baby loss. By committing to funding the pathway roll-out across England, the Government can ensure that families who suffer the loss of a baby receive consistent, sensitive, world-class bereavement care right across our NHS.

Jackie Doyle-Price: I congratulate my hon. Friend the Member for Colchester (Will Quince) on securing this  debate on the important work of the national bereavement care pathway. It is only three years since he was elected to this House, but in that time, he has done more than simply putting this important issue on the political agenda. He has drawn considerable attention to it and really moved it forward, and I thank him most sincerely for that.
I also thank the hon. Member for North Ayrshire and Arran (Patricia Gibson), who has been a willing ally and partner in that work. We thank her for sharing her experiences, which I know must have been very painful. I am also grateful for the efforts of my hon. Friend the Member for Banbury (Victoria Prentis), who has applied her very considerable energy to this project. It is with pride that I stand alongside all these Members today to address this important subject which, as I have said, has really moved on in the past three years. I must also pay tribute to my hon. Friend the Member for Ludlow (Mr Dunne), from whom I have inherited this part of my portfolio. He left it in very good shape, which makes it very much easier for me to address the House on it this evening.
I was fortunate enough to attend the launch of wave 2 of the pathway here in Parliament just last week, when I met the charities, led by Sands, that are working hard to expand the pathway, and representatives from the wave 1 and wave 2 permanent sites. That uplifting event celebrated the difference that the pathway is making to parents across the country, and I was pleased to hear about the positive evaluation of the wave 1 pilot sites since the pathway was launched last October. I was particularly moved to hear the story and experiences of Cheryl Gadsby. She really brought to life the huge difference that the right care can bring to bereaved parents. Against that background—
Motion lapsed (Standing Order No. 9(3)).
Motion made, and Question proposed, That this House do now adjourn.—(Mike Freer.)

Jackie Doyle-Price: I am glad you did that then, Mr Speaker, because I was just getting to a good bit.
Although my hon. Friend the Member for Colchester said that he did not want to put me on the spot about further funding, he actually did—very effectively—so before I go any further this evening, I am pleased to announce that the Department of Health and Social Care will provide additional funding for Sands to further develop and roll out the national bereavement care pathway in the coming financial year. It is a shame that the House is not busier, because it is not often that Ministers get the chance to say such things from the Dispatch Box.
The Department has been in conversation with Sands and can confirm £106,000 of funding to support the roll-out of the pathway in 2018-19. That is more than double the Department’s original funding of £50,000 to support the first year of the programme. While I am sure that all Members present understand that funding for future years cannot be committed at present, I hope that the announcement of this funding demonstrates the Government’s commitment to supporting the pathway as it moves towards national roll-out. The funding  comes following recognition of the great strides forward that the pathway project is making in ensuring that all bereaved are offered the right high-quality care at a time of enormous tragedy.
I should pause here, as I did at the parliamentary event last week, to highlight the Government’s wider ambitions for maternity care because, as we have heard this evening, the number of deaths at childbirth are too high. The Secretary of State’s ambition is to reduce rates of stillbirths, neonatal and maternal deaths and brain injuries by 50% by 2025. Our even closer goal is to achieve a 20% reduction by 2020, which illustrates our desire to make rapid progress.
To that end, the Secretary of State launched a refreshed maternity strategy last year—not long after the moving debate on baby loss in the House last October. The strategy highlights further action that the Government and NHS England have taken to improve safety and reduce the number of stillbirths and other adverse maternity outcomes. The initiatives include funding for the new healthcare safety investigation branch to develop investigation standards and conduct independent investigations into all cases that meet the criteria of the “Each Baby Counts” programme run by the Royal College of Obstetricians and Gynaecologists. That will amount to around 1,000 cases annually and will improve the rigour and quality of investigations into term stillbirths, neonatal and maternal deaths and serious brain injuries, and of learning from the investigations. The investigations began this month and will be rolled out to all areas of England by this time next year. Other initiatives include more support for safety training for all maternity and neonatal staff and an ambition to reduce the national rate of pre-term births from 8% to 6%, building on the world-class expertise already available across the 35 pre- term birth clinics in England.
The Department of Health, together with the Health Departments in Scotland and Wales, has funded the development of a national standardised perinatal mortality review tool to support systematic, multidisciplinary reviews of the circumstances and care leading up to every stillbirth and neonatal death. The tool is now available and enables teams to provide clear and accurate information to parents about why their baby died. It will also help staff to understand where lessons can be learned and allow for future care to be improved.
I am happy to report that we are making progress towards achieving our 2020 ambitions. The stillbirth rate in England has fallen from 5.1 per 1,000 births in 2010 to 4.3 in 2016. The neonatal mortality rate was 2.7 deaths per 1,000 births in 2016, down from 2.9 in 2010, but we must continue to do all we can to ensure the best maternity care in this country and the most appropriate support if parents do suffer bereavement at birth.
We are committed to providing high-quality bereavement care, as I hope I have proved and demonstrated with my announcement this evening. Since 2010, the Government have invested £35 million in the NHS to improve birthing environments, including better bereavement rooms and quiet spaces, at nearly 40 hospitals. On 2 February 2018, the Secretary of State announced the Government’s intention to conduct a review of whether the law should be changed to allow parents to register a pregnancy loss that occurs at less than 24 weeks’ gestation, as many hon. Members have called for. The review will also look more broadly at what can be done to improve care and support for parents going through such losses.
It is crucial that parents who experience pregnancy loss, regardless of the gestation stage at which the loss occurs, receive the best possible care and support, and that we use all opportunities to learn for the future when things go wrong. The review will speak to parents, clinicians, midwives and other experts to develop recommendations to ensure that pregnancy losses before 24 weeks’ gestation are handled with the same sensitivity and care as losses at a later gestation.
The Department is also conducting a review of whether the law should be changed to enable or require coroners to investigate stillbirths. Currently, coroners have the power to investigate only if there is doubt as to whether a baby was stillborn or lived independently, regardless of whether doctors declared it a stillbirth. Some parents feel that a coroner’s investigation would help to provide answers when a baby is stillborn and that such learning could help to avoid similar tragedies in future. As part  of that review, the Department is working with the Ministry of Justice to consult parents and experts about whether and, if so, how current legislation on coronial powers in relation to stillbirths should be amended to ensure that all avenues for investigating and learning from tragic events are considered.
Once again, I thank all Members of the House who have done so much to raise awareness of what can be done to support bereaved families through such tragedies. I am delighted to have been able to announce further funding for the national care bereavement pathway today, and I will closely follow its development as wave 2 of the pilot sites gets under way.
Question put and agreed to.
House adjourned.